In this article, we discuss 5 best casino stocks to buy now. If you want to read our detailed analysis of these stocks, go directly to 14 Best Casino Stocks To Buy Now.
5. Penn Entertainment, Inc. (NASDAQ:PENN)
Number of Hedge Fund Holders: 33
Penn Entertainment, Inc. (NASDAQ:PENN) provides integrated entertainment, sports content, and casino gaming experiences. It is one of the top casino stocks to invest in. In mid-August, the firm revealed in a regulatory filing that it had exercised CALL rights to bring its ownership in Barstool Sports to 100%. The formal takeover of the company is expected to be complete by early next year. In January 2020, the firm had invested $163 million for a 36% share in the sporting firm.
On August 5, Barclays analyst Brandt Montour maintained an Overweight rating on Penn Entertainment, Inc. (NASDAQ:PENN) stock and raised the price target to $44 from $37, appreciating the solid second quarter earnings of the firm.
Among the hedge funds being tracked by Insider Monkey, Washington-based firm HG Vora Capital Management is a leading shareholder in Penn Entertainment, Inc. (NASDAQ:PENN), with 3.5 million shares worth more than $106.5 million.
In its Q2 2022 investor letter, Baron Funds, an asset management firm, highlighted a few stocks and Penn Entertainment, Inc. (NASDAQ:PENN) was one of them. Here is what the fund said:
“PENN Entertainment, Inc. (NASDAQ:PENN) declined 28.3% in the quarter and penalized performance by 71 bps. This was due to investor concerns that a potential recession would result in a slowdown or decline in growth. The company has seen no material change to its visitation or spending levels, and its earnings remain strong. Penn is generating strong cash flow to more than offset investments in its digital growth opportunity. It is using excess cash to buy back its stock. Penn is well positioned to weather a slowdown or recession and, if one does occur, the company should still generate revenue and EBITDA above pre-pandemic levels.
Management continues to use its excess cash for share repurchases and debt reduction as well as continuing investments in its digital businesses. We think the $50 million of losses this year from its digital business is modest in relation to Penn’s $1 billion of casino EBITDA. The losses from its digital business represent customer acquisition costs incurred as additional states legalize online gambling. Since it is far less expensive to retain existing customers than to acquire new ones, we expect marketing costs to decline as Penn builds its customer base.
Penn’s core bricks and mortar casino business remains strong, and the company has a healthy regional casino business and a strong balance sheet to fund its digital losses.”
4. Boyd Gaming Corporation (NYSE:BYD)
Number of Hedge Fund Holders: 35
Boyd Gaming Corporation (NYSE:BYD), together with its subsidiaries, operates as a multi-jurisdictional gaming company. The firm features on the list of best casino stocks to invest in. On July 26, the firm posted earnings for the second quarter of 2022, reporting earnings per share of $1.48, beating estimates by $0.09. The revenue over the period was $894 million, up over 0.1% compared to the revenue over the same period last year. The company is based in Las Vegas and was founded in 1975.
On September 23, investment advisory JMP Securities initiated coverage of Boyd Gaming Corporation (NASDAQ:BYD) stock with an Outperform rating and a $65 price target. Analyst Jordan Bender issued the ratings update.
At the end of the second quarter of 2022, 35 hedge funds in the database of Insider Monkey held stakes worth $898 million in Boyd Gaming Corporation (NYSE:BYD), compared to 40 in the previous quarter worth $1 billion.
In its Q2 2022 investor letter, Baron Funds, an asset management firm, highlighted a few stocks and Boyd Gaming Corporation (NYSE:BYD) was one of them. Here is what the fund said:
“Boyd Gaming Corporation (NYSE:BYD) is one of the largest and most successful casino entertainment companies in the U.S. The company owns and operates 28 casino gaming properties in 10 states with a large presence in Las Vegas. Business conditions have been strong, yet the shares are valued at only 6 times 2022 estimated cash flow versus a long-term average of more than 9 times cash flow. The company maintains a strong and liquid balance sheet. Insiders own approximately 27% of the company. We believe Boyd is a compelling acquisition target.”
3. Las Vegas Sands Corp. (NYSE:LVS)
Number of Hedge Fund Holders: 42
Las Vegas Sands Corp. (NYSE:LVS), together with its subsidiaries, develops, owns, and operates integrated resorts in Asia and the United States. The company is one of the most prominent casino stocks to invest in. Some of the famous properties it owns include The Venetian Macao Resort Hotel, the Londoner Macao, The Parisian Macao, The Plaza Macao, Four Seasons Hotel Macao, Cotai Strip, and the Sands Macao, as well as the Marina Bay Sands in Singapore.
On September 26, investment advisory Jefferies upgraded Las Vegas Sands Corps. (NASDAQ:LVS) stock to Buy from Hold with a price target of $50, up from $40. Analyst David Katz issued the ratings update.
Among the hedge funds being tracked by Insider Monkey, Chicago-based firm Citadel Investment Group is a leading shareholder in Las Vegas Sands Corp. (NYSE:LVS), with 4.1 million shares worth more than $138.6 million.
In its Q2 2022 investor letter, Baron Funds, an asset management firm, highlighted a few stocks and Las Vegas Sands Corp. (NYSE:LVS) was one of them. Here is what the fund said:
“Certain travel-related businesses remain cyclically depressed not secularly challenged and should rebound as economic strength re-emerges. For example, the business operations of Macau-centric casino and gaming companies such as Las Vegas Sands Corporation (NYSE:LVS) have yet to recover due to the ongoing COVID-19 challenges in China. We expect business to rebound sharply when economic growth recovers just as it did in Las Vegas. Las Vegas Sands Corporationis a global leader in the development and operation of luxury casino resorts in Macau and Singapore, and it maintains a liquid and investment grade balance sheet. It is currently valued at a significant discount to our assessment of replacement cost, and the company’s Macau operations are valued at only 7 times estimated cash flow.”
2. MGM Resorts International (NYSE:MGM)
Number of Hedge Fund Holders: 46
MGM Resorts International (NYSE:MGM), through its subsidiaries, owns and operates casino, hotel, and entertainment resorts in the United States and Macau. The firm is among the best casino stocks to invest in. In late September, the company revealed that it had entered into a strategic partnership with ExteNet Systems, a leading national provider of converged communications infrastructure, to design, build, and operate advanced in-building signal and connectivity solutions.
On September 26, Citi analyst George Choi maintained a Buy rating on MGM Resorts International (NASDAQ:MGM) stock and raised the price target to $58.50 from $58, citing the resumption of Macau-bound e-Visas in late October and early November as a positive surprise.
At the end of the second quarter of 2022, 46 hedge funds in the database of Insider Monkey held stakes worth $1.1 billion in MGM Resorts International (NYSE:MGM), compared to 59 in the preceding quarter worth $2.18 billion.
In its Q2 2022 investor letter, Baron Funds, an asset management firm, highlighted a few stocks and MGM Resorts International (NYSE:MGM) was one of them. Here is what the fund said:
“MGM Resorts International (NYSE:MGM) is a leading global casino and entertainment company. At its recent price of only $30 per share, we believe MGM is valued at a significant discount to our reasonable $50 per share estimate of the sum-of-the-parts value of its business. Further, the company’s domestic operations are valued at a 18% free-cash-flow yield. Paul Salem, Chairman of the Board, recently acquired shares.”
1. Caesars Entertainment, Inc. (NASDAQ:CZR)
Number of Hedge Fund Holders: 59
Caesars Entertainment, Inc. (NASDAQ:CZR) operates as a gaming and hospitality company in the United States. It is one of the top casino stocks to invest in. In early September, the company announced that the sport wagering mobile app of the firm was now available for use in Kansas. The Caesars Sportsbook is now available in 26 states and North American jurisdictions. 19 of those sports betting locations are mobile. The company claims it operates the most retail sportsbooks across the US.
On August 3, B Riley analyst David Bain maintained a Buy rating on Caesars Entertainment, Inc. (NASDAQ:CZR) stock and lowered the price target to $102 from $128, noting that the stock seemed woefully undervalued.
Among the hedge funds being tracked by Insider Monkey, New York-based investment firm HG Vora Capital Management is a leading shareholder Caesars Entertainment, Inc. (NASDAQ:CZR), with 5 million shares worth more than $191.5 million.
In its Q4 2021 investor letter, Carillon Tower Advisers, an asset management firm, highlighted a few stocks and Caesars Entertainment, Inc. (NASDAQ:CZR) was one of them. Here is what the fund said:
“Caesars Entertainment, Inc. (NASDAQ:CZR), a diversified casino-entertainment and resort company, underperformed in the period as its quarterly earnings update was viewed as disappointing by investors. The firm highlighted a number of one-time headwinds that ultimately weighed on margins, as well as some negative impacts brought on by the surge in COVID cases. Despite this, we believe that the sizeable overall margin improvements Caesars has realized coming out of the pandemic will ultimately prove sustainable in the long run.”
You can also take a peek at 15 Best Gambling Stocks To Buy Now and 10 High Dividend Stocks Picked by Billionaire Gabelli.
