Gambling companies have digitized most of their operations to adapt to changing market trends over the past year. Also, online gambling has received approval from various state governments over the past year. Investor optimism about this industry is evident in Roundhill Sports Betting and iGaming ETF’s (BETZ) 96% returns over the past year, versus S&P 500’s 34.5% gains.
With the easing of travel restrictions, physical casinos are gradually reopening nationwide. However, the popularity of online gambling is here to stay, given government approvals and tech integrations that ensure seamless user experiences. Indeed, the global ‘online’ gambling market is expected to grow 12.3% year-over-year in 2021.
Boyd Gaming Corporation (BYD)
BYD is a multi-jurisdictional gaming company that operates through three segments: Las Vegas Locals, Downtown Las Vegas, and Midwest & South. On June 9, BYD sealed a strategic partnership with Hawaiian Airlines under which members will earn extra benefits and rewards with Boyd Gaming’s award-winning B Connected player loyalty program and the carrier’s celebrated HawaiianMiles program. This arrangement is expected to increase BYD’s customer base and demand for membership significantly.
On March 8, BYD partnered with FanDuel Group to introduce the first real-money online casinos under the Stardust brand. This partnership should increase player engagement and increase the company’s market reach significantly.
BYD’s total revenues increased 10.7% year-over-year to $753.31 million in its fiscal first quarter, ended March 31. Its operating income grew 240.6% from the year-ago value to $193.74 million, while its net income improved 169.2% year-over-year to $102.16 million. The company’s EPS increased 169.2% year-over-year to $0.90.
Analysts expect BYD’s revenues to increase 496.9% year-over-year to $780.4 million in the current quarter, ending June 2021. A $0.87 consensus EPS estimate for the current quarter indicates a 188.8% rise from the same period last year. Furthermore, BYD surpassed the Street’s EPS estimates in each of the trailing four quarters. Shares of BYD have gained 170.5% over the past year and 36.7% year-to-date.
It is no surprise that BYD has an overall A rating, which equates to Strong Buy in our proprietary POWR Ratings system. The POWR Ratings are calculated considering 118 different factors, with each factor weighted to an optimal degree.
The stock also has an A grade for Growth, and a B grade for Value, Sentiment, Momentum, and Quality. Among the 30 stocks in the Entertainment – Casinos/Gambling industry, BYD is ranked #1.
To see additional BYD Ratings and other information, click here.
Note that BYD is one of the few stocks handpicked currently in the Reitmeister Total Return portfolio. Learn more here.
Golden Entertainment, Inc. (GDEN)
GDEN owns and operates a diversified entertainment platform. The company operates through two segments: casinos and distributed gaming. It is also the largest distributed gaming operator in the United States.
On May 27, The STRAT Hotel, Casino & SkyPod, a wholly owned subsidiary of GDEN, partnered with Las Vegas’s leading theatrical production company SPI Entertainment to introduce diversity in its entertainment offerings. This move should diversify GDEN’s audience base substantially. GDEN’s revenue increased 15.7% year-over-year to $239.70 million in its fiscal first quarter, ended March 31. Its net income stood at $10.62 million, up 132.56% from the same period last year. Its operating income grew 290.8% from its year-ago value to $26.37 million. The company’s EPS increased 129.9% year-over-year to $0.35.
A $246.33 million consensus revenue estimate for its fiscal second quarter (ending June 2021) represents a 224.2% increase year-over-year. The Street expects the company’s EPS to rise 115% from the prior year quarter to $0.42 in the current quarter. GDEN has gained 326.3% over the past year. The stock has returned 119.7% year-to-date.
GDEN has an overall rating of A, which equates to Strong Buy in our proprietary POWR Ratings system. GDEN has an A grade for Sentiment, and a B grade for Growth, Momentum, and Quality. It is ranked #2 in the Entertainment – Casinos/Gambling industry.
Click here to view additional GDEN Ratings for Value, and Stability.
Want More Great Investing Ideas?
BYD shares were trading at $60.34 per share on Monday afternoon, up $1.66 (+2.83%). Year-to-date, BYD has gained 40.59%, versus a 12.90% rise in the benchmark S&P 500 index during the same period.
About the Author: Subhasree Kar
Subhasree’s keen interest in financial instruments led her to pursue a career as an investment analyst. After earning a Master’s degree in Economics, she gained knowledge of equity research and portfolio management at Finlatics. More...
More Resources for the Stocks in this Article
|Ticker||POWR Rating||Industry Rank||Rank in Industry|
|BYD||Get Rating||Get Rating||Get Rating|
|GDEN||Get Rating||Get Rating||Get Rating|