JPMorgan recently overviewed the gaming industry, stating the sector is performing well even after the effects of the pandemic. It released a list of top casino stocks, and three casinos from Sin City secured the top three spots.
JPMorgan deems Caesars Entertainment, Red Rock Resorts, and Boyd Gaming the top three casinos in the state. Caesars is the second-biggest operator in the region, while Boyd dominates the Las Vegas downtown. Both Red Rock and Boyd generate substantial portions of revenue and earnings from Las Vegas locals. The demographic primarily comprises staffers from other facilities and retirees.
Most of the casinos that noted increased revenue in 2021 Q2 had a strong Las Vegas local audience. However, the segment may face unfavorable results if the pandemic worsens in the locality.
As per JPMorgan, the local Las Vegas market offers a favorable space with a high percentage of EBITDA to cash flow. Moreover, its sustainable growth is underpinned by appealing demand-supply dynamics and population growth.
Red Rock boasts the resources to stabilize its operations and even buyback shared with over 650 million dollars in sales. Caesars Entertainment is clearly the favorite facility for Wall Street as the casino us up 22.55% in 2021.
The casino leverages the emerging iCasino and online sports betting prospects to increase its national reach and sizable database. Caesars also rely on the beverage, entertainment, and food revenue to maintain a steady cash flow.
Boyd Gaming is also showcasing steady numbers in both regional and Sin City markets. As a result, analysts believe that its growth is stable and sustainable. The casino also boasts a diverse client base, maintaining its growth rate during the pandemic.
JPMorgan dictates that the casino holds an attractive footprint in regional drive-to sectors and Las Vegas locals. The market overlooks Boyd’s sports betting reach, but as it owns 5% of FanDuel, it is high time the community recognizes its sports betting operations.