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Gambling Stock Roundup: PENN, BYD Announce Buyouts, MLCO Launches Hotel Brand
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The last week saw gambling industry players Penn National Gaming Inc. (PENN - Free Report) and Boyd Gaming Corporation (BYD - Free Report) announcing buyouts.
Melco Resorts & Entertainment Limited (MLCO - Free Report) announced the launch of a luxury hotel brand, NUWA.
Week’s Most Important Stories in Detail
Penn National agreed to buy Pinnacle Entertainment Inc. (PNK) for $1.87 billion in cash and stock. Taking into account Pinnacle Entertainment’s debt, the total value of the deal is $2.8 billion. Pinnacle shareholders will get $20.00 in cash and 0.42 shares of Penn National shares for each Pinnacle share they own. This brings the purchase price to $32.47 per Pinnacle share based on Penn National’s closing price as of Dec 15.
As part of the deal, Penn National agreed to sell Pinnacle's gaming operations in Missouri, Indiana and Ohio to Boyd Gaming Corporation for $575 million in cash. The transaction is anticipated to close in the second half of 2018. The deal is expected to yield $100 million in annual run-rate cost savings within 2 years of closing.
Boyd Gaming announced that it will purchase Valley Forge Casino Resort in King of Prussia, Pennsylvania, from Valley Forge Convention Center Partners, L.P., for $280.5 million cash.
The company looks to leverage on the opportunities that opened up upon Pennsylvania's recent passage of gaming expansion legislation. The acquisition is expected to positively impact Boyd’s free cash flow and be immediately accretive to its earnings.
Melco Resorts announced the launch of a luxury hotel brand, NUWA. Scheduled to be launched in Macau and Manila on Jan 16, 2018, the brand launch is in line with the company’s plan to present phase III of City of Dreams Macau in the second quarter of 2018. The brand will substitute the Crown Towers Hotels, which is slated to expire soon.
With the introduction of NUWA, Melco expects to strengthen its operations in City of Dreams. The company believes that an increase in luxury hotel room inventory will bode well for the property's gaming operations. Further, long-term growth at the property will be driven by the company’s core mission to enhance guest experience.
Gaming Industry 5YR % Return
Price Performance
The following table shows the price movement of the major gambling stocks in the past week and the last six months:
Company
Last Week
Last 6 Months
WYNN
1.6%
24%
CNTY
0.4%
27.6%
MLCO
3.6%
27.6%
MCRI
-0.5%
48.8%
PENN
5.1%
42.7%
BYD
1.4%
40.8%
PNK
4.2%
65.9%
In the last five trading sessions, share price movement of the major gambling stocks displayed a mixed trend. Penn National Gaming gained the most (up 5.1%), followed by Pinnacle Entertainment (up 4.2%). Melco Resorts, Wynn Resorts (WYNN - Free Report) , Century Casinos (CNTY - Free Report) and Boyd Gaming recorded a gain of 3.6%, 1.6%, 0.4% and 1.4%, respectively. Monarch Casino & Resort (MCRI - Free Report) however lost 0.5%
In the last six months, the price performance of gambling stocks has been impressive. Among the stocks that appreciated the most were Pinnacle Entertainment and Monarch Casino that rallied 65.9% and 48.8%, respectively. Wynn Resorts, Century Casinos, Melco Resorts, Boyd and Penn National Gaming gained 24%, 27.6%, 27.6%, 40.8% and 42.7% respectively in the same time frame.
What’s Next in the Gambling Space?
We note that gambling stocks have oscillated between gains and losses in recent sessions and investors can expect this volatility to continue in the coming days.
Wall Street’s Next Amazon
Zacks EVP Kevin Matras believes this familiar stock has only just begun its climb to become one of the greatest investments of all time. It’s a once-in-a-generation opportunity to invest in pure genius.
Image: Bigstock
Gambling Stock Roundup: PENN, BYD Announce Buyouts, MLCO Launches Hotel Brand
The last week saw gambling industry players Penn National Gaming Inc. (PENN - Free Report) and Boyd Gaming Corporation (BYD - Free Report) announcing buyouts.
Melco Resorts & Entertainment Limited (MLCO - Free Report) announced the launch of a luxury hotel brand, NUWA.
Week’s Most Important Stories in Detail
Penn National agreed to buy Pinnacle Entertainment Inc. (PNK) for $1.87 billion in cash and stock. Taking into account Pinnacle Entertainment’s debt, the total value of the deal is $2.8 billion. Pinnacle shareholders will get $20.00 in cash and 0.42 shares of Penn National shares for each Pinnacle share they own. This brings the purchase price to $32.47 per Pinnacle share based on Penn National’s closing price as of Dec 15.
As part of the deal, Penn National agreed to sell Pinnacle's gaming operations in Missouri, Indiana and Ohio to Boyd Gaming Corporation for $575 million in cash. The transaction is anticipated to close in the second half of 2018. The deal is expected to yield $100 million in annual run-rate cost savings within 2 years of closing.
Boyd Gaming announced that it will purchase Valley Forge Casino Resort in King of Prussia, Pennsylvania, from Valley Forge Convention Center Partners, L.P., for $280.5 million cash.
The company looks to leverage on the opportunities that opened up upon Pennsylvania's recent passage of gaming expansion legislation. The acquisition is expected to positively impact Boyd’s free cash flow and be immediately accretive to its earnings.
Melco Resorts announced the launch of a luxury hotel brand, NUWA. Scheduled to be launched in Macau and Manila on Jan 16, 2018, the brand launch is in line with the company’s plan to present phase III of City of Dreams Macau in the second quarter of 2018. The brand will substitute the Crown Towers Hotels, which is slated to expire soon.
With the introduction of NUWA, Melco expects to strengthen its operations in City of Dreams. The company believes that an increase in luxury hotel room inventory will bode well for the property's gaming operations. Further, long-term growth at the property will be driven by the company’s core mission to enhance guest experience.
Gaming Industry 5YR % Return
Price Performance
The following table shows the price movement of the major gambling stocks in the past week and the last six months:
Company
Last Week
Last 6 Months
WYNN
1.6%
24%
CNTY
0.4%
27.6%
MLCO
3.6%
27.6%
MCRI
-0.5%
48.8%
PENN
5.1%
42.7%
BYD
1.4%
40.8%
PNK
4.2%
65.9%
In the last five trading sessions, share price movement of the major gambling stocks displayed a mixed trend. Penn National Gaming gained the most (up 5.1%), followed by Pinnacle Entertainment (up 4.2%). Melco Resorts, Wynn Resorts (WYNN - Free Report) , Century Casinos (CNTY - Free Report) and Boyd Gaming recorded a gain of 3.6%, 1.6%, 0.4% and 1.4%, respectively. Monarch Casino & Resort (MCRI - Free Report) however lost 0.5%
In the last six months, the price performance of gambling stocks has been impressive. Among the stocks that appreciated the most were Pinnacle Entertainment and Monarch Casino that rallied 65.9% and 48.8%, respectively. Wynn Resorts, Century Casinos, Melco Resorts, Boyd and Penn National Gaming gained 24%, 27.6%, 27.6%, 40.8% and 42.7% respectively in the same time frame.
What’s Next in the Gambling Space?
We note that gambling stocks have oscillated between gains and losses in recent sessions and investors can expect this volatility to continue in the coming days.
Wall Street’s Next Amazon
Zacks EVP Kevin Matras believes this familiar stock has only just begun its climb to become one of the greatest investments of all time. It’s a once-in-a-generation opportunity to invest in pure genius.
Click for details >>