Perhaps it’s because trading stocks can often mirror the thrill of winning big at the blackjack tables, or maybe it’s because Las Vegas conjures images of the world’s most flashy brands and businessmen. Regardless of the reason, it’s clear that gambling stocks are always among the most popular on Wall Street.
Luckily for investors, now is also a great time to be buying gambling stocks, as continued domestic strength, a great recovery in Macau, and overall international interest in gaming have led to rising share prices. In fact, according to our Zacks Industry Rank data, the overall gaming industry has gained more than 37.70% year-to-date, outpacing the S&P 500’s respectable 16.92% gain.
With casino stocks this hot right now, investors are not going to want to miss out. Luckily, we can use Zacks’ proven stock-picking methods to find solid stocks in any industry. Check out these casino stocks today:
1. Wynn Resorts (WYNN - Free Report)
Led by the legendary Steve Wynn, this iconic gaming brand is looking strong after another solid earnings report. Wynn crushed estimates on the top and bottom line, expanded its operations in key markets, and posted EPS and revenue growth rates of over 100% and 45%, respectively. These great results have led to positive earnings estimate revisions, helping the stock earn a Zacks Rank #1 (Strong Buy).
Thanks to these revisions, the Zacks Consensus Estimate for Wynn’s upcoming fiscal year has gained a staggering 41 cents over the past 30 days. Furthermore, the company is growing its cash flow by nearly 12% and generating a whopping $7.61 in cash per share right now. Wynn’s valuation metrics might cause some hesitation, but its P/E of 28.72 and P/S of 2.64 are not far off the industry averages and certainly within a reasonable range.
2. Monarch Casino & Resort (MCRI - Free Report)
Monarch Casino & Resort operates the Atlantis Casino Resort in Reno, Nevada, as well as the Monarch Black Hawk Casino in Black Hawk, Colorado. MCRI is currently sporting a Zacks Rank #2 (Buy). The company is projected to post modest growth figures this year, with current consensus estimates calling for EPS growth of 9% and revenue growth of 8%
Nevertheless, Monarch’s small property portfolio allows it to operate more efficiently than others in the casino industry. For example, the company’s historical cash flow growth of 12% and net margin of 12% significantly outpace the industry averages. Also, the company’s property in Reno is considered a hidden Tesla (TSLA - Free Report) play, as the resort sits near the carmaker’s new gigafactory and should benefit from economic growth in the area.
3. Century Casinos (CNTY - Free Report)
Century Casinos owns and operates six casinos in Colorado and Alberta, as well as several gaming services aboard cruise ships and within existing resorts. In its most recent quarter, Century surpassed the Zacks Consensus Estimate for earnings by an impressive 181%, recording year-over-year EPS growth of 287% in the process. CNTY is currently a Zacks Rank #1 (Strong Buy).
Looking ahead, our consensus estimate for Century’s upcoming fiscal year has gained six cents over the past 30 days, and we now expect the company to post EPS growth of 40% in that period. CNTY is also sporting an “A” grade for Momentum, primarily because of its nearly 20% surge over the past 12 weeks. However, with a P/E of 24.88 and a P/S of 1.27, Century is still presenting strong value, especially compared to its gaming industry peers.
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