Wall Street analysts had differing takes on Monarch Casinos & Resorts’ trajectory, as evinced by a pair of February 4 investor notes. Truist Securities analyst Barry Jonas liked what he heard, whereas David Katz of Jefferies Equity Research said Monarch was “challenged” by an inability to expand.
Noting that Monarch beat Wall Street estimates by six percent, Jonas reported that its Reno property was “seeing growth post-renovation and Black Hawk [was] continuing to soar.” He added that management was “upbeat on trends,” which they saw continuing into 2026.
Jonas applauded Monarch for the quality of its properties, “stellar” business strategy, and its potential to execute mergers and acquisitions. He reiterated a Buy rating, but kept his price target at $120 per share. Monarch shares were trading at $93.31 apiece at the time.
For Katz, M&A was the stumbling block in Monarch’s path. He said the company’s improved results were “expected” and showed Monarch’s potency.
But Katz continued, “The company is challenged to execute on its next growth strategy, as identifying an asset/market that meets its criteria has been challenging. Therefore, the growth in the business remains modest, which tempers our constructiveness in the shares.”
Monarch may have beaten Wall Street, but it came up short of Katz’s forecast, delivering $140 million in revenue where he expected $142.3 million. However, cash flow of $51.8 million exceeded Katz’s expected $50.4 million and Wall Street’s target of $49 million.
Katz noted that Monarch’s litigation costs, a drag on earnings, would continue into 2026, but at a substantially lower level. He added that a Black Hawk promotion involving comped hotel rooms had depressed revenues in that department. Katz said this was “a strategy that is expected to continue going forward.”
Management’s opinion, according to Jonas, was “that occupancy grew at a healthy pace with a higher value casino comp mix.” He added that in Reno, Monarch had the best room product in the market and room to grow in the form of 20 acres of developable land.
In Colorado, Monarch Black Hawk continued to gain market share, particularly by drawing high-roller play from the Denver area. Given the quality of Monarch’s product, Jonas said, it would be unaffected by higher promotional spending by its competitors. He added that Monarch “remains confident it has more runway here in order to drive growth for its property.”
Monarch executives “stated its customer base has been consistent into 2026. MCRI continues to watch employment levels and population growth in each of its markets,” Jonas wrote.
The Truist analyst was unruffled by a lack of M&A activity, saying the company was “continually well positioned for M&A. We believe discussions remain very active, and expect more buybacks or another special dividend if nothing materializes.”
For his part, Katz tweaked his Monarch estimates for 2026. He reduced his revenue projection from $586 million to $568.9 million and his cash-flow projection from $205.5 million to $201.6 million.
Katz lopped his Monarch share-price target from $112 to $103 apiece. “Despite successful properties in growing markets, the absence of external growth limits share upside at present,” he concluded.
