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Red Rock Resorts (RRR) Q1 Earnings Miss Estimates, Down Y/Y

Zacks Equity Research

Red Rock Resorts, Inc. RRR reported mixed first-quarter 2019 financial numbers, wherein earnings fell short of the Zacks Consensus Estimate but revenues surpassed the same. Notably, this marked the company's fifth straight quarter of revenue beat. However, earnings missed the estimate in two of the trailing three quarters.

Adjusted earnings came in at 16 cents per share missing the Zacks Consensus Estimate of 32 cents. In the prior-year quarter, the company had reported adjusted earnings of 41 cents per share. Revenues totaled $447 million, faring better than the Zacks Consensus Estimate of $445 million. The top line also increased 6.2% year over year. The uptick can primarily be attributed to year-over-year gain in Las Vegas operations, which overshadowed decline in Native American management fees.

Casino revenues in the quarter amounted to $244.9 million, up 3.7% on a year-over-year basis. While food and beverage revenues increased 15.4% to $104.9 million, other revenues rose 14.9% to $25.9 million. Room revenues also increased 3.1% to $48.1 million. However, management fees revenues declined 6.2% to $23.2 million.

Segmental Details

Las Vegas Operations

Revenues at this segment summed $422.4 million, up 6.9% year over year. Also, the segment’s adjusted EBITDA increased to $130.5 million, up 3.7% year over year. Results were driven by robust performance across both the gaming and non-gaming segments.

Native American Management

Revenues at this segment declined 6.2% to $23 million. Meanwhile, adjusted EBITDA decreased to $21.5 million from $22.1 million on termination of the Gun Lake management agreement in February 2018.

Red Rock Resorts, Inc. Price, Consensus and EPS Surprise

Red Rock Resorts, Inc. Price, Consensus and EPS Surprise | Red Rock Resorts, Inc. Quote

Other Financial Details

As of Mar 31, 2019, Red Rock Resorts had cash and cash equivalent of $109.2 million. Outstanding debt at the end of the reported quarter was $3 billion. The company declared a quarterly cash dividend of 10 cents, payable Jun 28, 2019, to its shareholder of record as of Jun 14, 2019.

Zacks Rank & Key Picks

Red Rock Resorts, which shares space with Boyd Gaming Corporation BYD, carries a Zacks Rank #3 (Hold). Better-ranked stocks worth considering in the same space include PlayAGS, Inc. AGS and Las Vegas Sands Corp. LVS, each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

PlayAGS long-term earnings are likely to grow by 12%.

Las Vegas Sands’ current-year earnings are likely to witness 0.3% growth.

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