{"id":163013,"date":"2021-01-30T15:39:39","date_gmt":"2021-01-30T23:39:39","guid":{"rendered":"https:\/\/www.casino.org\/news\/?p=163013"},"modified":"2021-01-30T19:07:45","modified_gmt":"2021-01-31T03:07:45","slug":"regional-gaming-stocks-look-pricey-buy-on-pulbacks-says-analyst","status":"publish","type":"post","link":"https:\/\/www.casino.org\/news\/regional-gaming-stocks-look-pricey-buy-on-pulbacks-says-analyst\/","title":{"rendered":"Boyd, Red Rock, Other Regional Casino Names Warrant Caution, Says Analyst"},"content":{"rendered":"

Gaming companies with limited or no Las Vegas Strip exposure are proving sturdy relative to their Sin City-centric counterparts. But one analyst says it might be time to take some chips off the table.<\/p>\n

\"Regional
Hollywood Casino at Penn National Race Course in Pennsylvania. An analyst says regional gaming stocks can be bought on pullbacks. (Image: The Street<\/em>)<\/figcaption><\/figure>\n

JPMorgan analyst Joseph Greff, advises clients to embrace regional gaming equities on pullbacks, not at current, lofty prices.<\/p>\n

We are surprised with the 2021 share price strength, which follows torrid share price performance in the 4Q20,\u201d said the analyst. \u201cAnd given current valuation levels, we generally think the group is much better to be bought on pullbacks than putting in fresh money at current levels.\u201d<\/p>\n

With coronavirus restrictions still in place at gaming venues across the country, many on Wall Street<\/a> don’t expect the industry to show signs of earnings and revenue recovery until the back half of this year.<\/p>\n

On that note, Greff pared fourth-quarter first half 2021 earnings before interest, taxes, depreciation and amortization (EBITDA) estimates for an array of regional gaming names. They include Boyd Gaming (NYSE:BYD), Caesars Entertainment (NASDAQ:CZR), Churchill Downs (NASDAQ:CHDN), Penn National Gaming (NASDAQ:PENN) and Red Rock Resorts (NASDAQ:RRR)<\/strong>.<\/p>\n

Regional Casinos Still Grappling with Pandemic<\/h2>\n

The JPMorgan analyst points to \u201crising COVID-19 infection rates and the ensuing impact of casino restrictions on regional gaming visitation and spend\u201d as reasons for his downward revisions.<\/p>\n

\n

During the pandemic, casino operators with less destination market exposure are proving resilient, because they’re realizing new cost efficiencies — many of which are likely permanent — and customers can drive to these properties. For investors, each name should be evaluated on a case-by-case basis.<\/p>\n<\/div>\n

For example, Boyd and Red Rock generate significant portions of their revenue and EBITDA from the Las Vegas locals segment<\/a>. Many of those patrons are staffers at other casinos, tying those operators to the Strip’s rebound, even though all of their Sin City venues are off the Strip.<\/p>\n

Likewise, Caesars is the second-largest operator on the Strip. But its regional portfolio is deeper than that of rival of MGM Resorts. That’s a plus, but Greff sees tepid results for regional operators across the board during the first half of 2021.<\/p>\n

\u201cSimilarly, we expect 1Q21 regional results to be similar to December\u2019s and expect 2Q21 to be modestly better than the 1Q21; as such we are lowering our 1H21 estimates,\u201d he said in a note to clients<\/strong>.<\/p>\n

Churchill, Penn National<\/h2>\n

Churchill Downs and Penn National Gaming are classified as regional gaming names, with the latter boasting the biggest roster of such casinos in the country.<\/p>\n

However, the stocks are up 28 percent and 236 percent, respectively, over the past year, as investors increasingly view these names as iGaming and online sports betting<\/a> plays first, and casino operators second. Market participants baking in online casino and sports wagering on the likes of Churchill and Penn leads to higher valuations, something Greff cautions about regarding the broader regional group.<\/p>\n

\u201cAnd given current valuation levels, we generally think the group is much better to be bought on pullbacks than putting in fresh money at current levels,\u201d wrote the analyst.<\/p>\n

He has \u201coutperform\u201d ratings on all the stocks mentioned here.<\/p>\n","protected":false},"excerpt":{"rendered":"

Gaming companies with limited or no Las Vegas Strip exposure are proving sturdy relative to their Sin City-centric counterparts. But one analyst says it might be time to take some chips off the table. JPMorgan analyst Joseph Greff, advises clients to embrace regional gaming equities on pullbacks, not at current, lofty prices. We are surprised […]<\/p>\n","protected":false},"author":46,"featured_media":163014,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[62,10],"tags":[],"acf":[],"yoast_head":"\nRegional Gaming Stocks Look Pricey, Buy on Pulbacks, Says Analyst<\/title>\n<meta name=\"description\" content=\"Regional gaming stocks are getting expensive, prompting one analyst to say investors should wait for declines to get invovled.\" \/>\n<meta name=\"robots\" content=\"noindex, follow\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Regional Gaming Stocks Look Pricey, Buy on Pulbacks, Says Analyst\" \/>\n<meta property=\"og:description\" content=\"Regional gaming stocks are getting expensive, prompting one analyst to say investors should wait for declines to get invovled.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.casino.org\/news\/regional-gaming-stocks-look-pricey-buy-on-pulbacks-says-analyst\/\" \/>\n<meta property=\"og:site_name\" content=\"Casino.org\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/Casino.OrgNews\" \/>\n<meta property=\"article:published_time\" content=\"2021-01-30T23:39:39+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2021-01-31T03:07:45+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2021\/01\/penn.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1200\" \/>\n\t<meta property=\"og:image:height\" content=\"675\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Todd Shriber\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@etfgodfather\" \/>\n<meta name=\"twitter:site\" content=\"@Casino_Org\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Todd Shriber\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"3 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.casino.org\/news\/regional-gaming-stocks-look-pricey-buy-on-pulbacks-says-analyst\/\",\"url\":\"https:\/\/www.casino.org\/news\/regional-gaming-stocks-look-pricey-buy-on-pulbacks-says-analyst\/\",\"name\":\"Regional Gaming Stocks Look Pricey, Buy on Pulbacks, Says Analyst\",\"isPartOf\":{\"@id\":\"https:\/\/www.casino.org\/news\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/www.casino.org\/news\/regional-gaming-stocks-look-pricey-buy-on-pulbacks-says-analyst\/#primaryimage\"},\"image\":{\"@id\":\"https:\/\/www.casino.org\/news\/regional-gaming-stocks-look-pricey-buy-on-pulbacks-says-analyst\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2021\/01\/penn.jpg\",\"datePublished\":\"2021-01-30T23:39:39+00:00\",\"dateModified\":\"2021-01-31T03:07:45+00:00\",\"author\":{\"@id\":\"https:\/\/www.casino.org\/news\/#\/schema\/person\/f4cecf70a5032bc4e60eb73fc86d4a85\"},\"description\":\"Regional gaming stocks are getting expensive, prompting one analyst to say investors should wait for declines to get invovled.\",\"breadcrumb\":{\"@id\":\"https:\/\/www.casino.org\/news\/regional-gaming-stocks-look-pricey-buy-on-pulbacks-says-analyst\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/www.casino.org\/news\/regional-gaming-stocks-look-pricey-buy-on-pulbacks-says-analyst\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/www.casino.org\/news\/regional-gaming-stocks-look-pricey-buy-on-pulbacks-says-analyst\/#primaryimage\",\"url\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2021\/01\/penn.jpg\",\"contentUrl\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2021\/01\/penn.jpg\",\"width\":1200,\"height\":675,\"caption\":\"Hollywood Casino at Penn National Race Course in Pennsylvania. 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