Wall Street Bets is a roundup of recent notes from analysts covering the gambling industry.
New York online sports betting up slightly
New York State’s online sports betting was reviewed by J. P. Morgan’s Daniel Politzer on July 17. “Following the most recent weekly online sports betting figures released by the N.Y. Gaming Commission, 3QTD OSB revenue is tracking +3% year-over-year, while handle is tracking +9% year-over-year, implying a 10.7% hold rate (-61 basis points year-over-year). For the week ending July 13, revenue was +2% year-over-year, while handle was +8% year-over-year, implying a 10.6% hold rate vs 11.3% in the 2024 comparable period.”
Monarch Casino prospects are positive
Jefferies David Katz noted that Monarch Casino & Resorts’ second-quarter earnings, notably Adjusted EBITDA of $51.3 million, exceeded expectations of “our and the Street’s $51.1M. The quarter presented upside from early strength from the renovations in Reno and from gaining share in Black Hawk. Following the beat, we’ve raised our estimates, primarily in Reno, to reflect the expected ramp. That said, the absence of external growth leaves the risk/reward relatively balanced at present.”
Tariffs on gaming
Barry Jonas of Truist Securities examined the effect of tariffs on gaming, writing on June 16 that “gaming has mostly recovered from Q1’s tariff noise, with companies not yet pointing to any signs of consumer softness. Regionals, locals and digital look positive, though Vegas appears to be in a choppy summer, as expected. We particularly like the Locals market here and upgrade Red Rock Resorts to Buy (from Hold) expecting a strong Q2 beat with a potentially positive tone suggesting more upside ahead.”
Casino foot traffic rebounds
Jeffries’ Katz looked at casino foot traffic in a July 16 note.
“In June, Pennsylvania foot traffic was up +5.4% and +2.5% year-over-year,” Katz wrote. “Compared to 2019, Pennsylvania is up 22.2% and Massachusetts traffic is up +7.5%. In Atlantic City, June volumes were down -8.5% year-over-year, and down -19.5% from 2019 levels. Illinois is running -13.1% lower vs. 2019 and down 2% year-over-year.
“Our take is that the monthly performance reflects the ongoing normalization of traffic trends post-COVID, where volatility remains, as well as from competition and renovations in specific locations and the one less Saturday in the month.”
