In this piece we will take a look at the five best Las Vegas stocks to buy now. For more stocks, head on to 10 Best Las Vegas Stocks To Buy Now.
5. PENN Entertainment, Inc. (NASDAQ:PENN)
Number of Hedge Fund Holders: 36
PENN Entertainment, Inc. (NASDAQ:PENN) is an integrated gaming, casino, and entertainment provider that has facilities all over the U.S. These include its Tropicana Las Vegas Casino and Hotel and the firm is headquartered in Wyomissing, Pennsylvania.
PENN Entertainment, Inc. (NASDAQ:PENN) has the opportunity to emerge as a big winner from the state of Massachusetts’s decision to legalize betting on professional and college sports. This will allow the company to receive one of seven mobile betting platform licenses in the state. The company has consistently grown both its EBIT and EBITDA margins over the past three years, and it has a lower P/E ratio of 14x when compared to the industry average of 18x, indicating that PENN Entertainment, Inc. (NASDAQ:PENN) is undervalued.
Barclays raised PENN Entertainment, Inc. (NASDAQ:PENN)’s share price target to $44 from $37 in August 2022, sharing that the firm’s latest earnings results were solid. Of the 912 hedge funds surveyed by Insider Monkey for this year’s first quarter, 36 had invested in the company.
PENN Entertainment, Inc. (NASDAQ:PENN)’s largest investor is Jim Simons’s Renaissance Technologies which owns 1.7 million shares that are worth $75 million.
Baron Funds mentioned the company in its first quarter of 2022 investor letter and stated that:
“Penn declined 18.2% in the quarter and penalized performance by 54 basis points. This was due to investor concerns over continuing losses from its Barstool business. We believe the $50 million of losses this year from its digital business is modest in relation to Penn’s $1 billion of brick and mortar 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 digital losses.”
4. Las Vegas Sands Corp. (NYSE:LVS)
Number of Hedge Fund Holders: 39
Las Vegas Sands Corp. (NYSE:LVS) is a global integrated resort company that has facilities in the United States, the People’s Republic of China, Macau, and Singapore. It is headquartered in Las Vegas, Nevada, United States.
In an industry that is continuing to play hide and seek with sporadic bursts of coronavirus cases, Las Vegas Sands Corp. (NYSE:LVS) has a sturdy balance sheet that allows it to weather losses for at least 18 months before turning to debtors to raise more cash. Additionally, the firm is projected to touch $5 billion in revenue this year and double this to $10 billion next year, for sturdy outlooks for its future.
Wells Fargo raised Las Vegas Sands Corp. (NYSE:LVS)’s share price target to $47 from $45 in July 2022, outlining that there are few headwinds for the company in the future. Insider Monkey scanned 912 hedge fund portfolios for this year’s March quarter to discover that 39 had invested in the company.
Las Vegas Sands Corp. (NYSE:LVS)’s largest investor is John Khoury’s Long Pond Capital which owns 2.6 million shares that are worth $104 million.
Baron Funds mentioned the company in its first quarter of 2022 investor letter. Here is what the fund said:
“Following a 50%-plus decline in the share price of Las Vegas Sands Corporation from its 2021 peak share price of $67 to $34, we began acquiring shares of this global leader in the development and operation of luxury casino resorts in the fourth quarter of 2021 and continued to acquire shares in the most recent quarter. We believe Las Vegas Sands’ market-leading resorts in Macau and Singapore position the company for strong growth when travel and tourism spending rebounds. Las Vegas Sands maintains a liquid and investment grade balance sheet and is currently valued at a significant discount to our assessment of replacement cost.”
3. Boyd Gaming Corporation (NYSE:BYD)
Number of Hedge Fund Holders: 40
Boyd Gaming Corporation (NYSE:BYD) is a gaming and entertainment property owner that is headquartered in Las Vegas, Nevada, United States. The firm owns casinos and a travel agency.
Boyd Gaming Corporation (NYSE:BYD) is expected to grow its revenues to $3.6 billion this year and to $3.7 billion next year, as its skillful navigation of the post coronavirus environment continues to yield results. The company also has a 3.6% three year CAGR revenue growth to date, indicating that it was on an upward trajectory even before the pandemic hit. Additionally, it also pays a 15 cent dividend for a 1.09% yield.
Insider Monkey’s 912 hedge fund survey for this year’s Q1 outlined that 40 had bought the company’s shares.
Out of these, Parag Vora’s HG Vora Capital Management is Boyd Gaming Corporation (NYSE:BYD)’s largest investor through a $246 million stake that comes through 3.7 million shares.
In its Q1 2022 investor letter, Baron Funds mentioned the company and shared that:
“Following strong share price performance in 2021, the shares of Boyd Gaming Corporation continued to perform well in the first quarter of 2022. Boyd 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 and a geographic focus on the drive-to, leisure gaming customer. We remain optimistic about the prospects for Boyd’s shares because business conditions are strong, management maintains a liquid and conservatively capitalized balance sheet, insiders own approximately 27% of the company, the shares remain attractively valued at only 7.5 times 2022 estimated cash flow and a double-digit free cash flow yield, and we believe the company could be an attractive acquisition candidate should its current valuation remain discounted relative to recent private market casino and gaming transactions.”
2. MGM Resorts International (NYSE:MGM)
Number of Hedge Fund Holders: 59
MGM Resorts International (NYSE:MGM) is a casino and entertainment resort owner and operator in the United States and Macau. The company has more than two dozen hotel and gaming destinations globally and it is headquartered in Las Vegas, Nevada, U.S.A.
MGM Resorts International (NYSE:MGM) is poised to become the largest gaming company in the world, with its management expecting to grow its market share to 25% by the end of this year. Its BetMGM platform ranks in the top five platforms in the U.S. and it expects revenue from the segment to touch $1.2 billion in 2022.
Wells Fargo raised MGM Resorts International (NYSE:MGM)’s share price target to $58 from $49 in August 2022 sharing that strong performance from its Las Vegas properties had helped second quarter earnings. Out of the 912 hedge funds part of Insider Monkey’s Q1 2022 study, 59 had held a stake in the company.
MGM Resorts International (NYSE:MGM)’s largest investor is William B. Gray’s Orbis Investment Management which owns 6.9 million shares that are worth $293 million.
Baron Funds mentioned the company in its Q1 2022 investor letter and stated:
“At this stage, we believe several public real estate companies offer compelling long-term return prospects that, in some cases, may include a trifecta combination of growth, dividends, and an improvement in valuation. Examples of public real estate companies that are attractively valued includes: MGM Resorts International. Leading global casino and entertainment company. At its recent price of $40 per share, we believe the company is valued at a significant discount to our reasonable $60 per share estimate of the sum-of-the-parts value of its business.”
1. Caesars Entertainment, Inc. (NASDAQ:CZR)
Number of Hedge Fund Holders: 73
Caesars Entertainment, Inc. (NASDAQ:CZR) operates casinos, nightclubs, bars, lounges, hotels, and other venues in the United States. The company is headquartered in Reno, Nevada.
Caesars Entertainment, Inc. (NASDAQ:CZR) has the largest customer database in the U.S., which consists of 55 million customers, and despite having debt, the company has no pending acquisitions and a strong plan to reduce debt levels by next year.
B. Riley reduced the company’s share price target to $102 from $128 in August 2022 but flatly asserted that Caesars Entertainment, Inc. (NASDAQ:CZR) remains “woefully undervalued”. Insider Monkey looked at 912 hedge fund portfolios for their Q1 2022 holdings to discover that 73 had bought the company’s shares.
Disclosure: None. You can also take a look at 11 Best Covid Vaccine and Pill Stocks To Invest In and 10 Best Data Center Stocks To Invest In.
