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Gambling Stock Roundup: Macau Records 2nd Yearly Drop, Nevada November Sales Up

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The last week of 2015 was quite an uneventful one for the gambling industry. Gambling revenues in Macau for December plunged, as expected, and full-year revenues decreased too, marking the second consecutive decline on an annual basis.

Meanwhile, the Nevada Gaming Control Board announced revenue increased in the region for the month of November.

On the other hand, Penn National Gaming Inc. (PENN - Free Report) reaffirmed the fourth-quarter and full-year 2015 guidance. The company also announced the expected timing for the filing of certain restated financial statements with the Securities and Exchange Commission (SEC).  

Recap of the Week’s Important Stories:

1. Not surprisingly, Macau’s gross gaming revenues declined at a double-digit rate, yet again. According to Macau's Gaming Inspection and Coordination Bureau, December revenues plunged 21.2% for the 19th consecutive month. In fact, year-over-year revenues declined in double-digit figures in each month of 2015.

This massive decline led to 34.3% year-over-year plunge in gambling revenues in 2015. In fact, gambling revenues in Macau, the only destination in China where gambling is legal, recorded the second consecutive annual decline. Although the decline was less than the analysts' estimate of a 35% fall, this was the lowest since 2010.

2. According to the Nevada Gaming Control Board, Nevada gambling revenues in Nov 2015 increased 7.8% from the year-ago period to $944.3 million. The improvement followed the decline in October.

More specifically, casino revenues in the Las Vegas Strip – which accounts for more than half of Nevada’s total revenue – were up 5.4% year over year. Further, downtown Las Vegas saw a 25% hike, while Reno recorded a 3.3% rally in casino revenues.

In a separate report, the Las Vegas Convention and Visitors Authority said that visitor count of more than 42 million surpassed last year’s record of 41.1 million.

3. Penn National Gaming announced that it would restate its financial statements filed following the spin-off of its real estate assets to Gaming and Leisure Properties, Inc. on Nov 1, 2013. The restated statements will be filed with the SEC by no later than Feb 29, 2016.

The company also reiterated its outlook for fourth quarter and full-year 2015, initially issued on Oct 22, 2015. The company continues to expect that net revenue and adjusted EBITDA for the three months ended Dec 31, 2015 will be $722.5 million and $181.6 million, respectively. For 2015, the company projects net revenue of $2.79 billion and adjusted EBITDA of $754.5 million. 

Performance

The last week did not witness much share price movement. Some of the companies’ shares declined over the last five trading sessions with Caesars Acquisition Co. losing the most (6.1%) followed by Caesars Entertainment Corp. (CZR - Free Report) with 4.7% drop. However, shares of Boyd Gaming Corp. (BYD - Free Report) and MGM Resorts International (MGM - Free Report) gained over the same time frame.

Over the last six months, share prices of a majority of the gambling stocks decreased, with Wynn Resorts Ltd. (WYNN - Free Report) declining the most at 32.9%, followed 19.1% drop recorded by Las Vegas Sands Corp. (LVS - Free Report) . However, Boyd Gaming gained 33.4% over the same time.

Company

Last Week

Last 6 Months

WYNN

-1.45%

-32.87%

LVS

-1.13%

-19.08%

MGM

1.06%

22.48%

MPEL

-2.33%

-17.85%

CACQ

-6.07%

-1.16%

BYD

3.11%

33.36%

CZR

-4.71%

26.04%

 

What’s Next in the Gambling World?

Since no major development is expected this week, the performance of gambling stocks is unlikely to differ significantly.

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