{"id":221978,"date":"2022-07-19T13:15:08","date_gmt":"2022-07-19T18:15:08","guid":{"rendered":"https:\/\/www.casino.org\/news\/?p=221978"},"modified":"2022-07-19T14:20:37","modified_gmt":"2022-07-19T19:20:37","slug":"red-rock-could-get-margin-benefit-from-shutter-3-station-casinos","status":"publish","type":"post","link":"https:\/\/www.casino.org\/news\/red-rock-could-get-margin-benefit-from-shutter-3-station-casinos\/","title":{"rendered":"Red Rock Could Realize Margin Benefit by Closing Three Station Casinos"},"content":{"rendered":"

Red Rock Resorts\u2019 (NASDAQ:RRR) decision to permanently close Fiesta Henderson, Fiesta Rancho, and Texas Station could provide ballast to the operator\u2019s margins.<\/p>\n

\"Red
Fiesta Rancho and Texas Station, two of three Station Casinos being closed for good. Red Rock could realize margin benefits from that move. (Image: Jeff Scheid\/Nevada Independent<\/em>)<\/figcaption><\/figure>\n

The operator\u2019s decision to permanently shutter the three Station<\/a> casinos wasn\u2019t surprising, given that the venues had been closed for more than two years. But Deutsche Bank analyst Carlo Santarelli said there are benefits in cutting those properties from the company\u2019s roster.<\/p>\n

While the news was somewhat expected, we believe most are overlooking the impact these permanent closures will have on the margin floor for Red Rock Resorts moving forward, as well as the benefit to margins these closures have had on the balance of the locals portfolio,\u201d he said in a note to clients.<\/p><\/blockquote>\n

The Deutsche Bank analyst has a \u201cbuy\u201d rating on Red Rock stock, though last week, he lowered his price target on the name to $45 from $54.<\/p>\n

New Casinos Won\u2019t Replace Old Ones<\/h2>\n

Red Rock will ultimately demolish Fiesta Henderson, Fiesta Rancho, and Texas Station. When the land is eventually sold, it\u2019s unlikely it will be used for new casinos.<\/p>\n

\n

Santarelli says Red Rock will likely remove the gaming entitlements<\/a> from those properties before selling the land to non-gaming companies. Local media reports indicate that some North Las Vegas residents have an affinity for Fiesta Rancho and Texas Henderson, and would like to see the casinos reopened or turned into something else that benefits the public. Whether that\u2019s housing, retail, or mixed use remains to be seen.<\/p>\n<\/div>\n

Red Rock, one of the dominant operators among the Las Vegas locals contenders, has a reputation for buying up assets in the Las Vegas Valley to keep competitors away. When the company sells land from its vast property holdings, it\u2019s usually under terms that the buyer cannot open casinos on the purchased acres.<\/p>\n

In addition to its namesake venue in Summerlin and Green Valley Ranch in Henderson, Red Rock operates multiple gaming properties under the Station brand<\/a> throughout the Las Vegas area. The company also runs 10 Wildfire casinos, including seven in Henderson, according to its website.<\/p>\n

Uses for Station Casinos Cash<\/h2>\n

How much Red Rock can command for the land on which Fiesta Henderson, Fiesta Rancho, and Texas Station sit hasn\u2019t been publicly discussed. Because the venues aren\u2019t on the Strip or in downtown Las Vegas, price tags shouldn\u2019t be exorbitant.<\/p>\n

Whatever the proceeds are, Red Rock could direct that capital to various irons it currently has in the fire. These include the $750 million Durango<\/a> project in Southwest Las Vegas and a new Wildfire Casino in downtown. Analysts believe the company\u2019s expansion plans in its home market will pay dividends over the long term.<\/p>\n

\u201cRRR is on much better footing than most consumer companies — its core customers are confined to a single, high population growth market, and their wealth determined mostly by real estate wealth,\u201d <\/strong>according to Hedgeye analysts Todd Jordan and Sean Jenkins.<\/p>\n","protected":false},"excerpt":{"rendered":"

Red Rock Resorts\u2019 (NASDAQ:RRR) decision to permanently close Fiesta Henderson, Fiesta Rancho, and Texas Station could provide ballast to the operator\u2019s margins. The operator\u2019s decision to permanently shutter the three Station casinos wasn\u2019t surprising, given that the venues had been closed for more than two years. But Deutsche Bank analyst Carlo Santarelli said there are […]<\/p>\n","protected":false},"author":46,"featured_media":221982,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[62,81886],"tags":[],"acf":[],"yoast_head":"\nRed Rock Could Get Margin Benefit From Shutter 3 Station Casinos<\/title>\n<meta name=\"description\" content=\"Red Rock margins could earn boost from closing of three Station casinos.\" \/>\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\/red-rock-could-get-margin-benefit-from-shutter-3-station-casinos\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Red Rock Could Get Margin Benefit From Shutter 3 Station Casinos\" \/>\n<meta property=\"og:description\" content=\"Red Rock margins could earn boost from closing of three Station casinos.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.casino.org\/news\/red-rock-could-get-margin-benefit-from-shutter-3-station-casinos\/\" \/>\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=\"2022-07-19T18:15:08+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2022-07-19T19:20:37+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/07\/fiesta.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1101\" \/>\n\t<meta property=\"og:image:height\" content=\"866\" \/>\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\/red-rock-could-get-margin-benefit-from-shutter-3-station-casinos\/\",\"url\":\"https:\/\/www.casino.org\/news\/red-rock-could-get-margin-benefit-from-shutter-3-station-casinos\/\",\"name\":\"Red Rock Could Get Margin Benefit From Shutter 3 Station Casinos\",\"isPartOf\":{\"@id\":\"https:\/\/www.casino.org\/news\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/www.casino.org\/news\/red-rock-could-get-margin-benefit-from-shutter-3-station-casinos\/#primaryimage\"},\"image\":{\"@id\":\"https:\/\/www.casino.org\/news\/red-rock-could-get-margin-benefit-from-shutter-3-station-casinos\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/07\/fiesta.jpg\",\"datePublished\":\"2022-07-19T18:15:08+00:00\",\"dateModified\":\"2022-07-19T19:20:37+00:00\",\"author\":{\"@id\":\"https:\/\/www.casino.org\/news\/#\/schema\/person\/f4cecf70a5032bc4e60eb73fc86d4a85\"},\"description\":\"Red Rock margins could earn boost from closing of three Station casinos.\",\"breadcrumb\":{\"@id\":\"https:\/\/www.casino.org\/news\/red-rock-could-get-margin-benefit-from-shutter-3-station-casinos\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/www.casino.org\/news\/red-rock-could-get-margin-benefit-from-shutter-3-station-casinos\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/www.casino.org\/news\/red-rock-could-get-margin-benefit-from-shutter-3-station-casinos\/#primaryimage\",\"url\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/07\/fiesta.jpg\",\"contentUrl\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/07\/fiesta.jpg\",\"width\":1101,\"height\":866,\"caption\":\"Fiesta Rancho and Texas Station, two of three Station Casinos being closed for good. 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