Wall Street Bets is a roundup of recent notes from analysts covering the gambling industry.
Red Rock Resorts
In an April 6 note, Jefferies analyst David Katz wrote about a recent meeting the company hosted with Red Rock Resorts, “which provided further insights into its strategic outlook. Commentary on operations in Las Vegas Locals remains bullish, led by Durango success, further development projects and cost management strategies. We fine-tune our optimistic estimates for 1Q24, include updated balance sheet info and maintain our overall bullish view with further validation driving higher multiples. Target to $71 vs. $65, reiterate Buy.”
Everi Holdings
Analyst David Bain of B. Riley Securities in an April 4 note wrote, “We resume coverage of Everi Holdings with a neutral rating and $12 price target. To be clear, our neutral rating does not suggest we are close to being negative on Everi. We believe there is strong value at the current stock price and a solid argument for shares to go higher. However, we also believe structural issues along with well-telegraphed lower 1H24E KPIs may leave shares range bound for now. As the KPI’s begin to turn positive, we believe by BH24E, and the Everi/IGT game merger is nearer to fruition, we can envision becoming highly constructive on shares.”
Las Vegas Strip
In an April 3 note, Truist Securities analyst Barry Jonas wrote, “Our latest leisure focused Las Vegas Strip room rate survey suggests Q2 growth, following a flattish Q1. While we’ve previously noted a relatively less intense Vegas event calendar into Q2/Q3, rates have been surprisingly robust into Q2, with both MGM/Caesars showing year-over-year growth. The Fontainebleau opening still doesn’t appear to be pressuring the luxury segment, while Red Rock Resort’s Durango property rates have shown some moderation from launch highs (though June rates were indicating relative parity with Red Rock Resort’s namesake property). Overall, we see Strip room rate stability as positive for MGM/Caesars, and we’ll continue monitoring for signs of competitive pressures.”
