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Gambling Stock Roundup: Macau Gaming Revenues Decline, Coronavirus to Hurt PENN & CZR
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The last week has been a disappointing one for the gambling stocks. This is evident from the industry and the S&P 500 Index’s decline of 10.6% and 5.2% over the same timeframe. The decline can be primarily attributed to the coronavirus pandemic.
Recap of Last Week’s Most Important Stories
Macau Gross Gaming Revenue Decline in March
Although most of the casinos in Macau have resumed operations after coronavirus-induced shutdown, casino tables are still empty. This has resulted in sharp decline in gross gaming revenue (GGR) in March. Gaming revenues from the world’s largest gambling hub fell for the sixth consecutive month.
In March, gaming revenues from Macau plunged 79.7% to 5.26 billion patacas ($658.7 million) following a decline of 87.8% in February. The decrease can be primarily due to a reduction in footfall as China continued to decline individual and group visas to Macau as a safety precaution. In fact, Macau has put restrictions on all non-residents who have recently traveled abroad. The government has also enforced body temperature check at casino entrances. Moreover, in the first three months of 2020, gross gaming revenues declined 60%, year over year to $30.48 billion patacas ($3.8 billion).
Penn National Revokes 2020 Outlook
The devastating impact of the coronavirus outbreak (COVID-19) on the global economy has compelled Penn National Gaming, Inc. (PENN - Free Report) to withdraw its previously announced 2020 guidance.
With the coronavirus pandemic showing no signs of abatement, most companies worldwide are undertaking measures to tackle the situation. The companies are not only stalling production but are also focusing on cost-cutting actions. Despite best efforts by policymakers, it is becoming increasingly difficult for companies to stay afloat amid such trying times.
Notably, the company initiated certain actions to reduce operating expenses in a bid to mitigate the financial impact of the COVID-19 pandemic. Notably, the CEO and the board of directors have agreed to a pay cut effective from Apr 1, 2020. Moreover, the board has decided to furlough part of its corporate workforce effective Apr 1, 2020
Caesars Entertainment Shuts Operations on Coronavirus Concerns
Caesars Entertainment Corporation (CZR - Free Report) has shut down properties due to coronavirus scare. The company is operating on minimum workforce to maintain the basic operations as they are unable to ascertain the duration of the epidemic. The company has furloughed employees, which will impact nearly 90% of its workforce.
CEO Tony Rodio said “Given the closure of our properties, we are taking difficult but necessary steps to protect the company's financial position and its ability to recover when circumstances allow us to reopen and begin welcoming our guests and employees back to our properties.”
Caesars Entertainment carries a Zacks Rank #3.
Wynn Resorts Extends Employee Benefits
Despite coronavirus hurting the gaming industry, Wynn Resorts, Limited (WYNN - Free Report) announced that it will pay all salaried, hourly and part-time employees through May 15. More than 15,000 current Wynn and Encore employees will have a total of 60 days of payroll continuance.
Wynn Resorts CEO Matt Maddox said “It is our shared responsibility to follow the direction of health and safety professionals to stay home, and limit social contact.”
Wynn Resorts has a Zacks Rank #4 (Sell).
Price Performance
The following table shows the price movement of the major gambling stocks in the last week and the last six months:
In the past five trading sessions, shares of PlayAGS, Inc. (AGS - Free Report) and Boyd Gaming Corporation (BYD - Free Report) have lost the most.
Moreover, shares of PlayAGS have lost the most in the past six months.
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Gambling Stock Roundup: Macau Gaming Revenues Decline, Coronavirus to Hurt PENN & CZR
The last week has been a disappointing one for the gambling stocks. This is evident from the industry and the S&P 500 Index’s decline of 10.6% and 5.2% over the same timeframe. The decline can be primarily attributed to the coronavirus pandemic.
Recap of Last Week’s Most Important Stories
Macau Gross Gaming Revenue Decline in March
Although most of the casinos in Macau have resumed operations after coronavirus-induced shutdown, casino tables are still empty. This has resulted in sharp decline in gross gaming revenue (GGR) in March. Gaming revenues from the world’s largest gambling hub fell for the sixth consecutive month.
In March, gaming revenues from Macau plunged 79.7% to 5.26 billion patacas ($658.7 million) following a decline of 87.8% in February. The decrease can be primarily due to a reduction in footfall as China continued to decline individual and group visas to Macau as a safety precaution. In fact, Macau has put restrictions on all non-residents who have recently traveled abroad. The government has also enforced body temperature check at casino entrances. Moreover, in the first three months of 2020, gross gaming revenues declined 60%, year over year to $30.48 billion patacas ($3.8 billion).
Penn National Revokes 2020 Outlook
The devastating impact of the coronavirus outbreak (COVID-19) on the global economy has compelled Penn National Gaming, Inc. (PENN - Free Report) to withdraw its previously announced 2020 guidance.
With the coronavirus pandemic showing no signs of abatement, most companies worldwide are undertaking measures to tackle the situation. The companies are not only stalling production but are also focusing on cost-cutting actions. Despite best efforts by policymakers, it is becoming increasingly difficult for companies to stay afloat amid such trying times.
Notably, the company initiated certain actions to reduce operating expenses in a bid to mitigate the financial impact of the COVID-19 pandemic. Notably, the CEO and the board of directors have agreed to a pay cut effective from Apr 1, 2020. Moreover, the board has decided to furlough part of its corporate workforce effective Apr 1, 2020
Penn National carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Caesars Entertainment Shuts Operations on Coronavirus Concerns
Caesars Entertainment Corporation (CZR - Free Report) has shut down properties due to coronavirus scare. The company is operating on minimum workforce to maintain the basic operations as they are unable to ascertain the duration of the epidemic. The company has furloughed employees, which will impact nearly 90% of its workforce.
CEO Tony Rodio said “Given the closure of our properties, we are taking difficult but necessary steps to protect the company's financial position and its ability to recover when circumstances allow us to reopen and begin welcoming our guests and employees back to our properties.”
Caesars Entertainment carries a Zacks Rank #3.
Wynn Resorts Extends Employee Benefits
Despite coronavirus hurting the gaming industry, Wynn Resorts, Limited (WYNN - Free Report) announced that it will pay all salaried, hourly and part-time employees through May 15. More than 15,000 current Wynn and Encore employees will have a total of 60 days of payroll continuance.
Wynn Resorts CEO Matt Maddox said “It is our shared responsibility to follow the direction of health and safety professionals to stay home, and limit social contact.”
Wynn Resorts has a Zacks Rank #4 (Sell).
Price Performance
The following table shows the price movement of the major gambling stocks in the last week and the last six months:
In the past five trading sessions, shares of PlayAGS, Inc. (AGS - Free Report) and Boyd Gaming Corporation (BYD - Free Report) have lost the most.
Moreover, shares of PlayAGS have lost the most in the past six months.
Breakout Biotech Stocks with Triple-Digit Profit Potential
The biotech sector is projected to surge beyond $775 billion by 2024 as scientists develop treatments for thousands of diseases. They’re also finding ways to edit the human genome to literally erase our vulnerability to these diseases.
Zacks has just released Century of Biology: 7 Biotech Stocks to Buy Right Now to help investors profit from 7 stocks poised for outperformance. Our recent biotech recommendations have produced gains of +50%, +83% and +164% in as little as 2 months. The stocks in this report could perform even better.
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