Golden Entertainment Can Shine Among Casino Stocks
Golden Entertainment (NASDAQ:GDEN) stockpile is drawing sell-side extolment as a possible lead in the making among gambling casino equities.
In a note of hand to clients today, CBRE Equity Research analyst Saint John the Apostle DeCree resumed reportage of the Strat operator with a “buy” rating and a $58 price target. That implies upside of 45% from the Oct. 19 close. He cited compelling valuation, a sturdy balance shroud and the vibrant Las Vegas locals marketplace as among the reasons to be bullish on Golden stock.
Moreover, GDEN has unique financial flexibility following the sales event of Rocky Gap and could start reverting substantial working capital to shareholders inward the var. of buybacks and dividends, which given the company’s special working capital base, should interpret to meaningful value,” wrote DeCree.
In August, Golden proclaimed the sales agreement of the Rocky Gap Casino Resort inward Flinstone, Md. to Century Casinos (NASDAQ: CNTY) and VICI Properties (NYSE: VICI) for $260 one thousand thousand inwards cash. That transaction, which is scheduled to closemouthed inward the midsection of next year, is eq to to a greater extent than 20% of Golden’s electric current market place capitalization of $1.14 billion.
Golden Sturdy Balance Sheet, Possible Takeover Target
Golden’s properties are located throughout the Las Vegas Valley, levering the manipulator to vibrancy inwards that market.
Further cementing the pillowcase for Golden carry is an more and more unshakable counterbalance sheet, as highlighted past DeCree. Those highlights include the points that since the finish of last year, the gaming company cut debt by $200 meg and repurchased nearly $50 jillion worth of its own shares.
As for a dividend, those are tough to come in past in the gaming place at the moment, but Golden can buoy potential give a modest quarterly distribution. It could live to the company’s advantage to look at a payout because it would potentially broaden Golden’s investor base.
DeCree also mentioned Golden could be a takeover target, though he didn’t highlighting specific potentiality suitors apart from saying the accompany would be appealing for a “scaled strategic gaming operator.”
Indeed, Golden is affordable and perhaps appealing to any identification number of larger prospective suitors, peculiarly due to its all Silver State profile, which would live attractive to a challenger seeking to a greater extent exposure to the state. Analysts believe that due to the wobbly macroeconomic environment, large-scale mergers and acquisitions activity is potential on intermission o'er the near-term.
Other Casino Stocks inwards Focus
DeCree also started insurance coverage of Boyd Gaming (NYSE:BYD) and Red Rock Resorts (NASDAQ:RRR) — 2 of the dominant names in the Las Vegas locals securities industry — with “hold” ratings.
He placed a $60 damage point on Boyd, implying upside of 15.3% from the Oct. 19 close. His $44 cost object glass on Red River John Rock is 15.7% supra the Wednesday close.
The analyst is long-term bullish on the Las Vegas locals segment, but rising interest rates and the specter of a ceding back inward 2023 could weigh on gambling casino stocks, including Boyd and Red Rock, he said.