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Old 03-16-2020, 03:59 PM
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Gaming stocks

MGM: ⬇️34%
Sands: ⬇️9%
Caesars: ⬇️28%
Wynn: ⬇️24%
Red Rock: ⬇️30%
Boyd: ⬇️30%
Eldorado: ⬇️24%
Golden Ent.: ⬇️41%
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  #2  
Old 03-19-2020, 06:36 PM
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On Wednesday, the AGA said the U.S. economy stands to lose $21.3 billion in direct consumer spending from the legal gaming industry due to the shutdown of virtually all of the country’s casinos and resorts.

The closures have left an estimated 616,000 members of the gaming industry workforce on the sidelines.


“The federal government must act swiftly and comprehensively to get America’s hospitality employees, and the small businesses that support them, back to work,” said AGA CEO Bill Miller. “Gaming employees, their families, and communities are bearing the brunt of this economic standstill and will continue to suffer if Congress and the administration don’t take immediate action.”

The Seeking Alpha website suggested the growing belief that consensus will soon be reached on a government financial aid package led some analysts recommending that investors “nibble on the sector after the bruising sell-off.”


The larger gaming companies all saw increases Thursday.

MGM Resorts International was up 7.84% to close at $7.70; Las Vegas Sands increased 7.11% to close at $40.36, while Wynn Resorts gained 8.28% to close at $46.58.

Regional operators saw upticks. Boyd Gaming shares increased 42.98% to close at $11.21, Penn National Gaming was up 34.73% to close at $6.09, Twin River Worldwide increased 13.04% to close at $8.67, while Las Vegas-centric Red Rock Resorts increased 53.72% to close at $5.78.

The two regional companies involved in a $17.3 billion merger also saw stock increases Thursday. Eldorado Resorts was up 9.44% to close at $7.77 while Caesars rose 42.61% to close at $5.02. Eldorado, which is the acquiring company, hopes to close the deal in the first half of the year.



Slot makers hard hit

Gaming equipment manufacturers have been some of the hardest-hit shares on the market.

In a note to investors Thursday, Stifel Financial gaming analyst Brad Boyer said in the last month, shares of AGS are down 87%, Everi Holdings is off 86%, and Scientific Games is down 80%.

“With the majority of global casino operations shut down in the wake of the COVID-19 outbreak, shares of the industry’s primary equipment providers have come under significant pressure,” Boyer said.

Last week, according to a securities filing, 16 Everi executives and directors bought company shares in an effort to show support for the business. Chairman Miles Kilburn spent $204,600, or $3.41 per share, on 60,000 Everi shares. CEO Mike Rumbolz bought 50,000 shares for $186,000, or $3.72 per share.

On Thursday, Everi closed at $2.01, up 21.82%

Boyer blamed the “outsized” declines in the sector on three factors: elevated debt, the risk of burning through cash and liquidity, and the gaming industry’s uncertain outlook.

“It is safe to assume no CFO or CEO underwrites a business or capital structure plan in which he/she projects how the business would hold up in a prolonged zero revenue environment,” Boyer said. “Unfortunately, this previously unthinkable scenario is currently presenting itself to global casino operator management teams and those of its primary suppliers.”

Scientific Games rose 15.16% Thursday to close at $4.71, AGS saw a 28.57% increase to close at $1.35, while International Game Technology, which Boyer did not mention in his note, closed at $4.12, up 8.71%

“Shares across the group have come under significant pressure and investors’ singular focus has shifted to balance sheet risk and available liquidity,” Boyer said.



Stock transactions

Everi wasn’t the only company where directors and management were buying under-valued shares of their businesses.

On Monday, Gaming and Leisure Properties Chairman and CEO Peter Carlino was one of seven directors who acquired stock in the real estate investment trust. Carlino paid almost $970,000 for 47,000 shares at between $20.10 and $21.35.

Shares of GLPI closed Thursday at $17.53, up 15.79%.

Several directors of Golden Entertainment bought shares in the company earlier this week. On Thursday, President and CFO Charles Protell spent $45,000 on 10,000 shares of the company’s stock. Shares closed at $4.39 Thursday, up 1.15%

On Wednesday, MGM Resorts granted restricted stock to 16 directors and officers under the company’s incentive plan. The shares, which have no value until they vest later this year, can be redeemed any time afterward.
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Old 03-24-2020, 07:16 PM
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Some hope arrived Tuesday as the market bounced back to its largest one-day climb since 1933.


MGM Resorts closed up 33.11% to $12.18

Las Vegas Sands increased 3.20% to $44.84

Penn National was up 34.805 to $13.21

Red Rock Resorts increased 15.52% to $8,71

Boyd Gaming was up 23.34% to $15.01

Golden Entertainment was up 51.76% to $6.48


Investors following the pending $17.3 billion merger between Eldorado Resorts and Caesars Entertainment were hopeful the spike in the companies stock prices Tuesday was good for the deal, which has been expected to close sometime in the next three months.

Eldorado shares closed at $15.05, up 44.15% and Caesars increased by 2.49% to $6.18.

Deutsche Bank gaming analyst Carlo Santarelli told investors he believes the deal with move forward

“We think the deal is likely for several reasons, including… the committed financing from the banks is firm and we don’t see the banks backing away,” Santarelli said.

Monarch increased 16.61% to $22.39, Full House was up 27.50% to $1.02, and Century Casinos grew 70.62% to $2.73.

Boyd Gaming also announced Tuesday the closures of properties in five states – Illinois, Indiana, Louisiana, Ohio, and Pennsylvania – had been extended into April by either the governor or state regulatory bodies.
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Old 03-31-2020, 05:16 PM
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MGM Resorts International’s new chairman was one of four directors and executives who acquired stock in the casino giant Monday and Tuesday in an effort to boost the company’s share price which fallen roughly 82% since the middle of February.


In addition, acting MGM CEO Bill Hornbuckle signed a new management agreement in which he took a $300,000 a year pay cut. Hornbuckle, who became acting CEO on March 22, will earn $1.1 million in salary in 2020, but elected to take his salary for the rest of the year in restricted stock rather than cash.

The contract expires in March 2024.

The stock transactions and Hornbuckle’s new contract were announced in several filings with the Securities and Exchange Commission Tuesday.


Hornbuckle, in two transactions, acquired 41,000 shares of MGM Resorts spending roughly $496,177. The shares were traded at between $12.02 and $11.99.

New MGM Chairman Paul Salem spent $3.92 million to acquire 340,000 shares at an average price of $11.53 on Monday.

Hornbuckle, who remains MGM’s president, and Salem, a company director, were elevated to their positions on March 22 by the departure of Jim Murren.


MGM board member Keith Meister spent $5.66 million to acquire 500,000 shares at an average price of $11.32 on Monday. Meister, who joined MGM’s board in January 2019, was considered an activist investor in the company before he joined the board.

Meister is the general partner of Corvex Management, a New York-based hedge fund that owned 3% of MGM Resorts. According to the SEC filing, Monday’s acquisition was completed through Corvex.

MGM Chief Financial Officer Corey Sanders also acquired shares in the company, spending a $300,000 in two trades for nearly 25,000 shares at between $11.96 and $12.08.


Shares of MGM Resorts closed Tuesday on the New York Stock Exchange at $11.80, up 27 cents or 2.34%.

Sanders also signed a new employment agreement with MGM Resorts on Tuesday, reducing his base salary by $250,000 to $1 million and agreeing to take 50% of his salary in restricted stock.

On Friday, MGM Resorts said the company believes it has a “strong liquidity position” to “weather this downturn and ultimately rebound” from the shutdown its casinos.

In a statement, MGM said its balance sheet has approximately $3.9 billion, including approximately $1.5 billion drawn under its revolving credit facility. Last year, MGM paid off nearly $3.9 billion in debt. The company doesn’t have any debt obligations due until 2022.

Hornbuckle said in a statement the company’s cost-saving initiative introduced last year helped strengthen the balance sheet.

“While this will undoubtedly have a significant negative effect on our business in the near term, we are well-positioned to emerge from the current crisis in light of our strong liquidity position and valuable asset portfolio,” he said.

Gaming analysts said MGM is burning through $14.4 million a day to maintain the company, which would give the corporation approximately nine-to-10 months before it runs out of cash.

MGM said it was “making swift decisions” to reduce expenses. The company said 60% to 70% of its operating expenses are variable and it was looking at ways to minimize costs, such as hiring freezes, furloughs, and other job reductions. MGM also plans to delay 33% of its planned capital expenditures, such as renovations and improvements, to its U.S, properties.
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Old 04-06-2020, 06:32 PM
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The Dow closed up Monday more than 1,600 points or 7.6%, and the Nasdaq jumped 540 points or 7.3%.

Of the major casino operators, MGM Resorts International shares were up 22.02% to close at $12.91, Las Vegas Sands increased 7.33% to close at $40.70, and Wynn Resort closed at $56.73, up 16.97%.

All three companies have casino operations in Macau, which saw slowdowns when the pandemic hit China in January and the government forced casinos to close for 15 days in February. Gaming revenues fell 87.8% in February and 79.9% in March.

Already, analysts said April gaming revenues are down nearly 90%.

“It’s difficult to expect gross gaming revenue to improve until Mainland China travel restrictions are eased,” Hong Kong-based Macquarie Securities gaming analyst Edward Engel said Monday.

Gaming equipment manufacturers had a sold day Monday. International Game Technology shares rose 5.66% to $5.23, Scientific Games was up 27.6% to $7.49, AGS rose 17.36% to $1.69, and Everi Holdings was up 37.99% to $3.16.


Jefferies gaming analyst David Katz ...

Katz looked at seven regional casino operators – Eldorado Resorts, Caesars Entertainment, Churchill Down, Monarch Casinos, Golden Entertainment, Boyd Gaming, and Penn National Gaming – who all saw revenues and cash flow totals end last month and are expected to be at zero during April.

“Our discussions with various resources suggest that based on current circumstances, all of the companies should survive but the more highly levered names could be forced to seek permanent solutions to current, temporary challenges,” Katz said.

He added the $17.3 billion merger between Eldorado and Caesars was “highly likely to close” due to the considerable upside. Eldorado shares increased 38.09% Monday to $14.03 while Caesars was up $11.62% to close at $7.01.

Two companies, Boyd Gaming and Penn National, “have elevated leverage.”

Boyd, Katz said, has a “prudently conservative” management and “maintains optionality” from its real estate ownership. Penn’s regional gaming properties, he said, “should prove stable.”

Boyd was up 10.52% to close at $12.40 and Penn rose 12.9% to close at $11.09.

Golden Entertainment shares increased 18.63% to close at $6.24 and Red Rock Resorts increased 25.2% to close at $9.34.
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