Wall Street Bets is a roundup of recent notes from analysts covering the gambling industry.
Bally’s
In an April 20 note about Bally’s Corp., Jefferies analyst David Katz wrote that his firm is updating “our model ahead of 1Q24 earnings to reflect recently reported state data. Taking the data in total, the casino and resorts portfolio was negatively affected by the weather in January, and while February and March improved, the result was still lighter than our optimistic forecast.
“For 1Q24, we now expect casino and resorts revenues of $344.6 million and EBITDAR of $97.3 million, from $355 million and $101 million, respectively,” Katz continued. “On the interactive side, our impression is that slightly slower trends in January in International were more the result of a holiday hangover and not due to the weather. Meanwhile, North American interactive held up well. We leave our estimates for both interactive segments unchanged at $244 million in revenues for International and $39.9 million for North America in 1Q24.”
Las Vegas Strip room rates
J. P. Morgan Joseph Greff took the measure of Las Vegas Strip room rates for the week of May 12-18 in an April 21 statement.
“For the survey period, relative to the comparable period 2023, midweek rates are -5% and weekend rates are +3% (-1% overall),” Greff wrote. “By company: MGM rates are -11% for the midweek and +1% for the weekend (-6% overall); Caesars’ rates are flat for the midweek and -1% for the weekend (flat overall); Wynn Resorts rates are +9% for the midweek and +3% for the weekend (+6% overall); Venetian/Palazzo rates are -26% for the midweek and +31% for the weekend (-8% overall).
“Relative to the full 2Q23E, our midweek rates are +6% and weekend rates are +7% (+7% overall). By company: MGM rates are +2% weekday and +6% for the weekend (+4% overall); Caesar’s rates are -5% weekday and -3% for the weekend (-4% overall); Wynn Resorts rates are +2% weekday and +10% for the weekend (+5% overall); Venetian/Palazzo rates are +34% weekday and +37% for the weekend (+35% overall).”
East Coast Gaming Conference
Jefferies’ Katz also reported April 21 on the recent East Coast Gaming Conference in Atlantic City, New Jersey, which “provided key notes and panels on myriad topics affecting the industry beyond the eastern US. The focus issues included the presence and impact of `gray market’ games which negatively impact regulated operators. Our take is that distributed gaming can be a growth driver and customer acquisition tool if regulated properly. As well, the focus on responsible gaming technologies stood out, as operators discussed strategies and tools, notably in digital channels. Our take is that this could prove to be a productive use for AI, in conjunction with other customer engagement tools.”
