{"id":197575,"date":"2022-01-10T13:02:57","date_gmt":"2022-01-10T21:02:57","guid":{"rendered":"https:\/\/www.casino.org\/news\/?p=197575"},"modified":"2022-01-10T13:36:14","modified_gmt":"2022-01-10T21:36:14","slug":"boyd-churchill-downs-among-casino-stocks-preferred-by-bofa","status":"publish","type":"post","link":"https:\/\/www.casino.org\/news\/boyd-churchill-downs-among-casino-stocks-preferred-by-bofa\/","title":{"rendered":"Bank of America Likes Boyd, Churchill Downs, Sours on Red Rock, Sands"},"content":{"rendered":"

In a sweeping commentary on casino stocks today, Bank of America analyst Bank of America analyst Shaun Kelley recommends focusing on quality and value opportunities in the space.<\/p>\n

\"casino
Boyd Gaming’s Gold Coast Las Vegas. Boyd is among the casino stocks preferred by Bank of America. (Image: Carrie Roper\/Las Vegas Review-Journal<\/em>)<\/figcaption><\/figure>\n

In a note to clients, Kelley highlights at least seven gaming names, speaking bullishly on a quartet while downgrading a trio. Among the names the analysts like as quality and value plays are Boyd Gaming (NYSE:BYD) and Churchill Downs (NASDAQ:CHDN). The duo is off an average of 3.5 percent to start 2022. But that’s significantly less bad than the start to the year for a slew of casino stocks.<\/p>\n

\n

Las Vegas-based Boyd runs 28 gaming venues across 10 states, including 11 in its home city,<\/span> and it’s that exposure to the local market that makes the company one of Wall Street’s preferred gaming ideas<\/a> for 2022.<\/p>\n<\/div>\n

Both Boyd and Churchill are forecast to generate impressive free cash flow this year \u2013 a quality trait \u2013 and each is buying back their own shares, signaling management teams see value in those stocks<\/a>. Speaking of value, the Kentucky Derby operator may be offering that, trading around $223, with a consensus price target of almost $280.<\/p>\n

Challenges for Las Vegas Sands, Others<\/h2>\n

While Kelley sees a lot to like with Boyd and Churchill Downs, he’s less enthusiastic about Gaming and Leisure Properties (NASDAQ:GLPI), Las Vegas Sands (NYSE:LVS), and Red Rock Resorts (NASDAQ:RRR).<\/p>\n

He downgrades all three names to \u201cunderperform,\u201d and in the case of GLPI, it’s a double downgrade, because the stock goes from \u201cbuy\u201d to \u201cunderperform,\u201d while the other two were previously rated \u201cneutral.\u201d In the case of LVS, it’s the same old song: Macau. Ongoing lethargy in the world’s largest casino hub explains why so few on Wall Street<\/a> are bullish on Sands today.<\/p>\n

We see continued risk from COVID-related disruption and do not see a simple or easy exit from the implications for Macau of China\u2019s zero tolerance COVID policy,\u201d<\/strong> said Kelley. \u201cIn addition, we think key source markets around Southeast Asia could weigh on the pace of recovery in Singapore.\u201d<\/strong><\/p><\/blockquote>\n

The analyst adds concessionaires could pay more for Macau licenses when those permits are renewed, resulting in a lower return on invested capital, while perhaps hindering shareholder reward plans.<\/p>\n

Regarding the downgrade of Red Rock, Kelleys says the operator could be vulnerable to tough comparisons following a strong 2021, and rising costs in a tight Las Vegas labor market. When it comes to GLPI, he says that gaming real estate firm has more inflation protection than rival VICI Properties (NYSE:VICI).<\/strong><\/p>\n

High Beta Ideas<\/h2>\n

Kelley believes higher beta casino stocks could bounce back in the second half of 2022, as estimates and margins see decreased volatility. He likes Caesars Entertainment (NASDAQ:CZR) and Penn National Gaming (NASDAQ:PENN) in that group.<\/p>\n

Currently, there’s no shortage of support for Caesars, owing to what analysts view as its favorable mix of Las Vegas and regional exposure, coupled with a growing iGaming<\/a> and sports wagering footprint.<\/p>\n

With Penn, sentiment seems to be shifting to acknowledgment that the stock was battered too much last year and that investors may have lost sight of what’s a strong portfolio of land-based gaming assets.<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

In a sweeping commentary on casino stocks today, Bank of America analyst Bank of America analyst Shaun Kelley recommends focusing on quality and value opportunities in the space. In a note to clients, Kelley highlights at least seven gaming names, speaking bullishly on a quartet while downgrading a trio. Among the names the analysts like […]<\/p>\n","protected":false},"author":46,"featured_media":197577,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[62,10],"tags":[],"acf":[],"yoast_head":"\nBoyd, Churchill Downs Among Casino Stocks Preferred by BofA<\/title>\n<meta name=\"description\" content=\"Bank of America likes Boyd, Churchill Downs among casinos stocks, not so much with Sands and Red Rock.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.casino.org\/news\/boyd-churchill-downs-among-casino-stocks-preferred-by-bofa\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Boyd, Churchill Downs Among Casino Stocks Preferred by BofA\" \/>\n<meta property=\"og:description\" content=\"Bank of America likes Boyd, Churchill Downs among casinos stocks, not so much with Sands and Red Rock.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.casino.org\/news\/boyd-churchill-downs-among-casino-stocks-preferred-by-bofa\/\" \/>\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=\"2022-01-10T21:02:57+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2022-01-10T21:36:14+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/01\/GC2.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1200\" \/>\n\t<meta property=\"og:image:height\" content=\"797\" \/>\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\/boyd-churchill-downs-among-casino-stocks-preferred-by-bofa\/\",\"url\":\"https:\/\/www.casino.org\/news\/boyd-churchill-downs-among-casino-stocks-preferred-by-bofa\/\",\"name\":\"Boyd, Churchill Downs Among Casino Stocks Preferred by BofA\",\"isPartOf\":{\"@id\":\"https:\/\/www.casino.org\/news\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/www.casino.org\/news\/boyd-churchill-downs-among-casino-stocks-preferred-by-bofa\/#primaryimage\"},\"image\":{\"@id\":\"https:\/\/www.casino.org\/news\/boyd-churchill-downs-among-casino-stocks-preferred-by-bofa\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/01\/GC2.jpg\",\"datePublished\":\"2022-01-10T21:02:57+00:00\",\"dateModified\":\"2022-01-10T21:36:14+00:00\",\"author\":{\"@id\":\"https:\/\/www.casino.org\/news\/#\/schema\/person\/f4cecf70a5032bc4e60eb73fc86d4a85\"},\"description\":\"Bank of America likes Boyd, Churchill Downs among casinos stocks, not so much with Sands and Red Rock.\",\"breadcrumb\":{\"@id\":\"https:\/\/www.casino.org\/news\/boyd-churchill-downs-among-casino-stocks-preferred-by-bofa\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/www.casino.org\/news\/boyd-churchill-downs-among-casino-stocks-preferred-by-bofa\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/www.casino.org\/news\/boyd-churchill-downs-among-casino-stocks-preferred-by-bofa\/#primaryimage\",\"url\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/01\/GC2.jpg\",\"contentUrl\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/01\/GC2.jpg\",\"width\":1200,\"height\":797,\"caption\":\"Boyd Gaming's Gold Coast Las Vegas. 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