“Solid” was the word two Wall Street analysts repeatedly employed to describe Monarch Casinos & Resorts’ third-quarter results, after the gaming company released its latest numbers on Tuesday.
Truist Securities analyst Barry Jonas characterized Monarch as the bellwether for regional gaming stocks. He said he was keeping his Buy rating on it “and continue to appreciate Monarch’s high-quality, wholly owned assets,” in addition to its prospects for mergers or acquisitions.
Jefferies Equity Research analyst David Katz shaded his plaudits somewhat differently. In a research note, he wrote that Monarch “remains among the strongest executors in the industry with solid asset positioning, but lacks a clear internal or external growth path at present.”
Katz added that Monarch management was confident of record results in 2027. As for enlargement, executives “reiterated that its healthy balance sheet positions the company to simultaneously pursue growth initiatives and shareholder returns.”
Jonas noted that Monarch had come up one percent shy of Wall Street’s revenue expectation, though it had been slightly ahead of his own estimate. He called a three percent uptick in gambling win “solid.”
Katz, however, tweaked his projections for Monarch, forecasting $569 million in 2026 revenue, down from $572 million. Cash flow estimates were rejiggered from $209 million, however, up to $211 million. For 2027, Katz predicted $581 million in revenue (unchanged) and slightly higher cash flow: $216 million, up from $212.5 million.
“Despite successful properties in growing markets and continued cost discipline, we believe the absence of external growth limits share upside at present,” Katz wrote.
Jonas and Monarch itself were more upbeat.
“The overall market continued to grow, driven by the Reno bowlers and high slot hold during the quarter, though we think both were more prevalent for the downtown Reno casinos,” Jonas wrote of Monarch’s performance at its suburban Atlantis casino.
He added that while the company didn’t increase its Reno market share, it was upbeat in a “fiercely competitive” market, especially over the long haul.
Monarch did grow market share in Black Hawk, Colorado. In fact, it achieved record revenue there.
While the minimum wage in the Rocky Mountain State is set for a 3.6 percent hike in 2027, Monarch said it planned to counteract that with increased use of artificial intelligence.
“We think further share gain opportunity remains amongst the high-value, upper-end customers who are new to the property or visit less frequently,” Jonas wrote in a research note.
Despite the strength of its two casinos, Monarch allowed that there was “uncertainty” over consumer spending. The midterm elections, fuel costs, and inflation were all cited as contributory factors.
“That said,” Jonas wrote, Monarch “is seeing minimal impact from these headwinds in its two markets, given healthy economic/population trends and low unemployment rates.”
Noting that the company was very choosy about acquisitions, Jonas felt it might pick off some Caesars Entertainment property divestitures.
“We didn’t get the sense anything was imminent, but believe management is/will be active in current processes, as well as future potential processes,” wrote Jonas, adding that further construction activity in Reno was also quite possible.
