VICI Properties Inc. (VICI Quick QuoteVICI - Free Report) , which specializes in gaming and entertainment properties, reported its fourth-quarter and full-year 2024 results late in February. The company continued to benefit from its expansion efforts and strategic investments.

VICI’s fourth-quarter 2024 adjusted funds from operations (AFFO) per share of 57 cents came in line with the Zacks Consensus Estimate. Moreover, the figure increased 3.6% from the prior-year quarter. Results reflected a year-over-year rise in revenues, mainly driven by income from sales-type leases and income from lease financing receivables, loans and securities.

VICI Properties also continued to make disciplined capital deployments. It announced approximately $1.1 billion in capital commitments in 2024, with a weighted average initial yield of 8.1%, and consistently deployed capital each month. Notable investments included $700 million for The Venetian Resort Las Vegas through its Partner Property Growth Fund strategy. 

After the quarter ended, VICI revealed a strategic partnership with Cain International and Eldridge Industries, committing $300 million to a mezzanine loan supporting the development of One Beverly Hills. Reflecting positive sentiments, VICI has rallied 5.6% since its earnings release.

Amid market uncertainties emanating from policy shifts, economic volatility and anticipations of high inflation and elevated interest rates for a prolonged period fueling investor skepticism toward VICI Properties stock, let us break down the key fundamentals and recent developments to evaluate whether the stock remains an attractive investment.

What Aids VICI Properties Stock Growth?

VICI Properties posted total revenues of $976.1 million in the fourth quarter of 2024, reflecting a 4.7% year-over-year increase. This growth underscores the strength of VICI’s extensive portfolio, which spans some of the most prominent entertainment and gaming properties in the United States. The company continues to benefit from strategic acquisitions.

One of VICI’s core strengths lies in its disciplined capital deployment. In 2024, the company committed more than $1 billion in investments at a weighted average initial yield of 8.1%, reinforcing its ability to generate stable cash flows. Moreover, VICI’s $300 million mezzanine loan investment in One Beverly Hills, a 17.5-acre experiential luxury development project backed by Cain International and Eldridge Industries, expands its reach into high-end experiential real estate. This move diversifies its portfolio beyond traditional gaming assets.

Additionally, VICI has continued to deepen relationships with key gaming operators, such as MGM Resorts and Caesars Entertainment, supporting reinvestment in properties to enhance long-term asset value. Investments in The Venetian, Homefield Kansas City, and Great Wolf Resorts highlight VICI’s focus on assets with long-term growth potential.

VICI ended 2024 with a total debt of $17.1 billion but maintains a healthy liquidity position. The company has approximately $3.3 billion in total liquidity, including $524.6 million in cash, $376.3 million in proceeds from outstanding forward sale agreements, and $2.4 billion in availability under its revolving credit facility. Furthermore, in November 2024, VICI received a credit rating upgrade from Moody's to Baa3, achieving a major milestone by securing investment-grade credit ratings across all three major rating agencies, enhancing its ability to access capital at lower costs. Moreover, despite its high debt levels, VICI's net debt-to-EBITDA ratio of 5.3 remains within its target range of 5.0-5.5.

Solid dividend payouts are the biggest attraction for REIT investors, and VICI Properties has remained committed to that. Since 2018, VICI has maintained an impressive 7% annual dividend growth rate, surpassing many competitors in the triple-net REIT space, including Agree Realty Corporation (ADC Quick QuoteADC - Free Report) and Essential Properties Realty Trust, Inc. (EPRT Quick QuoteEPRT - Free Report) and Four Corners Property Trust, Inc. (FCPT Quick QuoteFCPT - Free Report) . VICI targets a 75% AFFO payout, offering stable income for dividend-focused investors. As a leading experiential REIT, it owns 54 gaming and 39 entertainment properties across North America, backed by long-term, triple-net leases averaging 40.7 years, ensuring a strong and reliable foundation for sustained growth and income.

Headwinds to Consider Before Choosing VICI Stock

Despite its strengths, VICI faces its share of challenges. VICI initiated 2025 AFFO guidance of $2.32-$2.35 per share, implying 3.3% growth year over year at the midpoint. This conservative AFFO outlook suggests that slower earnings growth may weigh on investor sentiment.

Gaming properties remain VICI’s primary revenue source despite diversification efforts, exposing it to industry-specific risks like regulatory shifts and economic downturns that impact discretionary spending and unfavorable developments within the gaming sector. Any financial strain on key tenants could impact cash flows, highlighting the company’s reliance on this sector for a significant portion of its earnings.

As a REIT, VICI is highly sensitive to interest rate movements. Elevated rates increase borrowing costs and may reduce the appeal of its dividend yield compared to risk-free Treasury yields. Additionally, ongoing volatility in REIT markets, driven by shifting interest rates and uncertain credit conditions, continues to be a concern for investors.

VICI Estimate Revisions and Stock Valuation

The estimate revision trends reflect positive sentiments. The Zacks Consensus Estimate for 2025 adjusted funds from operations (AFFO) per share has increased by two cents over the past week, while the same for 2026 has also moved north marginally over the past two months.

Image Source: Zacks Investment Research

Find the latest EPS estimates and surprises on Zacks Earnings Calendar.

In terms of valuation, VICI Properties stock still looks cheap as it is trading at a forward 12-month price-to-FFO of 13.88X, below the REIT-Other industry average of 15.52X but higher than its one-year median of 13.11X. 

Forward 12 Month Price-to-FFO (P/FFO) Ratio

Image Source: Zacks Investment Research

To Buy or Not to Buy VICI Properties Stock?

VICI is expanding its portfolio and deepening partnerships, but near-term challenges include elevated debt and macroeconomic uncertainty. However, its dividend growth, strategic investments and strong liquidity position continue to be attractive strengths for long-term investors. Waiting for more clarity on policy changes, inflation trends and their potential effects on the company could help determine whether the current valuation presents a buying opportunity or reflects underlying risks. However, existing shareholders may find it worthwhile to stay invested, given VICI’s strong track record of dividend growth and focus on attractive property sectors.

At present, VICI Properties carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

VICI Properties currently has an average brokerage recommendation (ABR) of 1.32 on a scale of 1 to 5 (Strong Buy to Strong Sell). Of the 22 brokers covering VICI, 18 rate it a “Strong Buy”, one a “Buy” and three call it a “Hold. The average price target of $35.57 suggests a 9.48% upside from the current levels.

Image Source: Zacks Investment Research

Note: Anything related to earnings presented in this write-up represents funds from operations (FFO) — a widely used metric to gauge the performance of REITs.