The universe of Black person Hawk, Colo. is simply 128, to a lesser extent than half what it was inwards 1999. But the cassino market place in the townspeople located most 35 miles W of Denver is flourishing.
While it’s the smallest townspeople in Colorado, Negroid Hawk is place to the state’s largest gaming shot — ace that ranks as the 10th-largest and as the fastest-growing inwards the US. As such, there are investment implications, because quartet Black Hawk operators are in public traded companies. In alphabetical order, they are Bally’s (NYSE: BALY), Caesars Entertainment (NASDAQ: CZR), Monarch Casino & Resort (NASDAQ: MCRI), and Penn Entertainment (NASDAQ: PENN).
In a recent report, Stifel analyst Jeffrey Stantial said Shirley Temple Hawk trends impressed inward the first quarter, and the townsfolk compares favourably against other regional gambling casino markets.
All operators cited stable/healthy demand trends YTD, with no more signs of tieback when drilling inward past income or eld cohort. Black Hawk market-wide development continues to outpace the broader regional same-store average,” noted the analyst.
He has “buy” ratings on Caesars and Monarch, and “hold” grades on Bally’s and Penn Entertainment.
Tailwinds, Headwinds for Black Hawk Casino Market
Black Hawk’s gambling casino market has some structural advantages, including Colorado’s fast-growing population and a policy that went into force inward 2021 that allows gaming operators to offering to a greater extent table games with higher limits.
On Election Clarence Day 2020, Colorado River voters approved Amendment 77. That lot the stage for Shirley Temple Black Hawk, Central City, and Cripple Creek gaming towns to ditch the prior $100 per mitt pileus on table gamy bets. On Tuesday, the Negroid Hawk City Council approved an ordinance permitting no restrictions on bets placed on blackjack, craps, roulette, and related fare.
Analysts trust the higher tabular array limits will allow Black Hawk casinos to hold on to a greater extent local bettors inward the townsfolk and out from Las Vegas, while potentially converting more twenty-four hours visitors into overnight guests. On the other hand, Negroid Hawk operators human face headwinds, such as a shoal fag pool, the want to make up insurance premium wages, and high up inflation.
“Given these constraints, most properties are forced to rely on high-priced temporary worker agencies to varying degrees. Outside of labor, utilities costs make been prostrate to flare-ups, with water a uniquely impactful expense, presumption local furnish constraints. Planned nongaming developments will potential farther append to [the] exact for water, and ride upward costs. Lastly, nutrient costs were cited as a headwind, with the market-leading assets (Monarch; Ameristar) anecdotally to a greater extent aggressive in release through rising prices via pricing,” added Stantial.
Monarch: blackamoor Hawk Casino Standout
Monarch Casino’s namesake Black Hawk property is the freshest integrated resort hotel inward the townspeople and ane of the highest-tier casino-hotels inward any of the trio CO gaming towns.
Obviously, that property benefits Monarch the most, especially considering the company owns just now II casinos. But it also provides small boosts to some Joseph Black Hawk rivals.
“Given the caliber of the product, pricing power remains robust. Given MCRI’s hotel pricing strategy, forthcoming way renovations at Ameristar testament potential transform to higher ADR for Monarch as well. For PENN, Ameristar continues to seizure spillover from Monarch as the second-largest property in the market,” concluded Stantial.
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