|Bid||15.64 x 1000|
|Ask||15.65 x 1100|
|Day's Range||15.23 - 16.41|
|52 Week Range||5.90 - 34.64|
|Beta (5Y Monthly)||2.19|
|PE Ratio (TTM)||2.90|
|Earnings Date||Jul 23, 2020 - Jul 27, 2020|
|Forward Dividend & Yield||0.01 (0.06%)|
|Ex-Dividend Date||Jun 09, 2020|
|1y Target Est||18.05|
At the end of February we announced the arrival of the first US recession since 2009 and we predicted that the market will decline by at least 20% in (see why hell is coming). In these volatile markets we scrutinize hedge fund filings to get a reading on which direction each stock might be going. […]
ROAR Digital, LLC ("ROAR" or the "Company") – the US sports betting and online gaming company operating as BetMGM and owned jointly by MGM Resorts International (NYSE: MGM) ("MGM Resorts") and GVC Holdings (LSE: GVC) ("GVC") – announced today that its shareholders have committed to a second round of investment, bringing the total to $450 million. This increase follows MGM Resorts' and GVC's total initial commitment of $200 million and underpins their commitment to BetMGM becoming a leading player in the rapidly growing US sports betting and iGaming markets. These two rounds of investment provide the Company with over $370 million of investable capital at present.
The last time I wrote about MGM Resorts (NYSE:MGM) and MGM stock was in mid-June. The company's Las Vegas casinos were starting to open up and business would soon return to normal. Investors were cautiously optimistic. Source: Jason Patrick Ross / Shutterstock.com However, since then, it's become clear the novel coronavirus isn't going away any time soon. In fact, it might be stronger than ever. As a result, MGM stock has lost its momentum and is struggling to stay in the mid- to high-teens. Reopening Hasn't Been a Slam DunkIn my June 18 article, I said that given the difficulties casinos would face when reopening their locations -- reduced capacities, increased cleaning, security, and labor costs -- MGM would likely see some downside as a result. And that's precisely what's happened. InvestorPlace - Stock Market News, Stock Advice & Trading Tips * 7 Utilities Stocks to Buy With Reassuring Dividends For this reason, I recommended investors interested in betting on MGM consider the VanEck Vectors Gaming ETF (NASDAQ:BJK) instead. By playing the field, investors will win once casinos return to normal. Until then, a bet on BJK reduces your exposure to any one company. Unlike Amazon (NASDAQ:AMZN), which is a good proxy for consumer stocks, MGM Resorts isn't necessarily the best proxy for casinos. Who is, I couldn't say. What I do know is that none of the casino stocks stand out in terms of their ability to withstand Covid-19.As InvestorPlace's Brett Kenwell recently stated, MGM stock is a tough buy at the moment. I couldn't agree more. While I like the MGM brand, large gatherings have proven to be effective "super spreaders" during the pandemic. Nevada is reporting record daily highs for Covid-19 cases and now, casino properties, including MGM's Bellagio and Signature Condominiums, are being sued by employees for unsafe working conditions. Investors hate uncertainty. What could be more uncertain than a virus that's already killed almost 130,000 Americans? People are scared to go to work right now and that's especially true in hot spots in the South and Southwest. An Alternative to BJKA possible alternative for anyone who absolutely must make a bet on MGM, and doesn't want to buy BJK, would be to invest in the Invesco S&P 500 Equal Weight Consumer Discretionary ETF (NYSEARCA:RCD). It gives you 61 S&P 500 consumer discretionary stocks, all equal-weighted, and rebalanced four times a year in March, June, September, and December. At 0.40%, it's not cheap, but it does closely track the performance of the S&P 500 Equal Weight Consumer Discretionary Index. For some investors, the biggest downside of RCD is the fact it tends to overweight mid-cap stocks as a result of the equal weighting. For me, that makes it even more attractive, because I see mid-cap stocks as the sweet spot in terms of long-term performance. Each quarterly rebalance, the 61 stocks return to a weighting of 1.64%. As of June 29, MGM's weighting was 1.49%, a sign that it's retreated since its latest rebalance. Slightly more than half the holdings are currently above 1.64% with Gap (NYSE:GPS) doing the best this quarter with the only weighting over 2%. Year to date through June 29, RCD has a total return of -20.01%, less than half MGM's total return of -49.0%. The Bottom Line on MGM StockInvestorPlace contributor Mark Hake recently suggested that investors wait and see how MGM's reopenings perform before taking a bite out of MGM stock. "The problem right now is that there is no dividend yield. Investors receive little income while waiting for the stock to recover. Therefore, I would wait to see what the upcoming reopening results will bring. Are the high-end casinos and resorts booking sufficient revenue for the company to turn around?" Hake wrote on June 25. With the July 4 weekend coming up, investors should get a better idea of how fast MGM will bounce back. I'm skeptical that people are going to want to be in casinos when Nevada, Arizona, and California are setting record numbers of Covid-19 cases.If you can't make the ETF play to get your MGM exposure, I would wait until the fall before considering buying MGM stock. That's because another significant correction could be in store for stocks over the next two months. If that happens, stocks like MGM will face further downside.I don't believe the risk/reward is in your favor at the moment. Will Ashworth has written about investments full-time since 2008. Publications where he's appeared include InvestorPlace, The Motley Fool Canada, Investopedia, Kiplinger, and several others in both the U.S. and Canada. He particularly enjoys creating model portfolios that stand the test of time. He lives in Halifax, Nova Scotia. At the time of this writing Will Ashworth did not hold a position in any of the aforementioned securities. More From InvestorPlace * Why Everyone Is Investing in 5G All WRONG * America's 1 Stock Picker Reveals His Next 1,000% Winner * Revolutionary Tech Behind 5G Rollout Is Being Pioneered By This 1 Company * Radical New Battery Could Dismantle Oil Markets The post Casinos, Like Airlines, Are Best Avoided for Now appeared first on InvestorPlace.
As Covid-19 cases rise around the country, investors betting on a casino resurgence may be pressing their luck. Still, there are some regional players worth buying, says Jefferies.
The reopening of Las Vegas last month made investors bullish on MGM Resorts (NYSE:MGM) stock. But, with a rise in new novel coronavirus cases, a rapid comeback for this casino giant looks questionable.Source: Jason Patrick Ross / Shutterstock.com The company is taking proactive moves to ensure safety, like requiring masks in public places on its properties. But that may not be enough to reassure potential visitors to its Las Vegas and regional hotels. With just 36% of Americans comfortable riding on a plane, Vegas casinos are going to have a tough time filling up hotel rooms and getting people to their gaming tables.So what does that mean for MGM stock in the near-term? Expect today's uncertainty to continue. Yet uncertainty may be good when it comes to making money with this stock.InvestorPlace - Stock Market News, Stock Advice & Trading TipsIf MGM's near-term prospects were brighter, its shares would be trading closer to their pre-pandemic price levels. In other words, their risk/reward ratio would not be very favorable. But, as the shares move lower, investors' odds improve.I'm not saying that the shares are a screaming buy at today's prices. But if the shares creep down to $10 and below, consider the stock a strong bottom-fishing pick. What a Second Wave Means for MGM StockEarlier this month, the shares of this hard-hit casino stock went higher, as investors wagered on a rapid, "V-shaped" recovery. In the minds of many, the pandemic was entering the rear-view mirror. Indeed, with many states opening up, it seemed like the nation was going to rapidly "return to normal." * 7 Utilities Stocks to Buy With Reassuring Dividends What a difference a few weeks makes. With reported cases rising, investors, political leaders, and other stakeholders may have gotten ahead of themselves. That is to say, we are far from out of the woods when it comes to the pandemic.Will Nevada and other states walk back their reopening plans? Will they impose a second lockdown? That remains to be seen. Also unclear is whether MGM's casino business will continue accelerating throughout the summer.As InvestorPlace columnist Mark Hake wrote in his June 25 column, "wait and see" is a good approach. With the July 4th weekend just days away, we'll soon see the extent to which MGM's operations are bouncing back. If the crowds during Independence Day weekend are larger than expected, that will be a clear sign that things aren't as bad as recent headlines indicate.Granted, many will still shun places with large crowds, like casinos. But, if the mask requirements can help minimize infection risks, and if enough people are daring (or stubborn) enough to hit the tables, MGM's comeback story may still be in motion.That being said, today's share price is reasonable, but not dirt cheap. Yet, considering the fact that other casino stocks have become frothier, valuation may not be much of an issue for MGM stock. MGM's Valuation Is ReasonableUsing the enterprise value/EBITDA (EV/EBITDA) metric, MGM looks reasonably priced, but not cheap. The shares have an EV/EBITDA ratio of 12.9. Rivals like Caesars Entertainment (NASDAQ:CZR), and Las Vegas Sands (NYSE:LVS) sell at similar or lower valuations.But, as I wrote earlier this month, the shares look like a bargain compared to Penn National (NASDAQ:PENN) stock. With Penn's sports-wagering catalyst helping to boost its valuation, that stock currently has an EBITDA multiple of 15.And that's despite the fact that the easy money's already been made with Penn stock. Even as "second wave" fears threaten this company's comeback, MGM remains a stronger bet on a casino comeback.Nevertheless, now may not be the best time to buy MGM stock. Given that rising coronavirus cases could cause another selloff, an opportunity to buy the shares at an even cheaper price may be just around the corner.Sure, there's a chance that MGM's July 4 weekend results could exceed expectations, sending its shares higher. But giving up some potential gains for less risk may be worthwhile. With Uncertainty Still in the Cards, Take Your Time Before Betting on MGM StockCasino stocks are less risky than the shares of other hard-hit sectors. Airline stocks, for example, face a bumpier road.Nevertheless, casino stocks could dip down the road, creating a solid entry point.I'm not saying, "bet big on MGM stock." It could be years before the company gets fully "back to normal." But if its stock continues to dip, take advantage of uncertainty and buy it on any pullback.Thomas Niel, contributor to InvestorPlace, has written single-stock analysis since 2016. As of this writing, Thomas Niel did not hold a position in any of the aforementioned securities. More From InvestorPlace * Why Everyone Is Investing in 5G All WRONG * America's 1 Stock Picker Reveals His Next 1,000% Winner * Revolutionary Tech Behind 5G Rollout Is Being Pioneered By This 1 Company * Radical New Battery Could Dismantle Oil Markets The post As Coronavirus Cases Surge, MGM Stock Could Head Lower appeared first on InvestorPlace.
The S&P 500 Index is a market-capitalization-weighted index of the 500 largest publicly traded companies in the U.S. It is widely regarded as the best gauge of large-cap U.S. equities. Some of the largest companies in the index include Microsoft Corp.
Casino workers are suing MGM Resorts International (NYSE: MGM) and Caesars Entertainment Corporation (NASDAQ: CZR), alleging failure to protect employees from the new coronavirus. What Happened On Monday, the workers filed a lawsuit in the U.S. District Court in Las Vegas claiming that Caesars Entertainment owned Harrah's and MGM-owned Bellagio and MGM Grand did not end food and beverage operations at once after learning of COVID-19 positive cases, reported the Wall Street Journal. The lawsuit, filed by Culinary Union Local 226 and Bartenders Union Local 165, further alleges that employees were not informed immediately when co-workers tested positive, and contact-tracing of affected employees was not carried out adequately before they were allowed to return to work. An MGM spokesperson told the Journal that the resort operator had offered free testing to employees before they returned to work. The spokesperson also claimed that managers are trained in response protocols and worked with public-health officials on contact tracing.Caesars Entertainment revealed that a restaurant employee had tested positive, and an investigation had been conducted which identified co-workers that came in contact with the affected employee.Why It Matters The unions involved in the lawsuit represent 60,000 hospitality workers, according to the WSJ.Nineteen union workers or their dependants have died due to COVID-19, while three valets and bellmen have tested positive at the Signature at MGM Grand. Nevada Governor Steve Sisolak ordered compulsory face masks for anyone inside a casino starting June 26. Last week, Caesars Entertainment introduced a compulsory mask policy at all its resorts, which extends to employees, vendors, contractors, and guests.Businesses are vying for legal protection against liability arising from exposure to COVID-19, a topic that has led to a rift among Democrats and Republicans.Price Action MGM shares traded 0.71% higher at $16.94 in the after-hours session on Monday. The shares had closed the regular session 7% higher at $16.82.Caesars Entertainment shares traded 0.58% higher at $12.14 in the after-hours session on Monday. The shares had closed the regular session 2.72% higher at $12.07.See more from Benzinga * Amazon Web Services Establishes Dedicated Aerospace And Satellite Solutions * Iran Wants To Arrest Donald Trump Over General Qasem Soleimani Death In Baghdad * Xilinx Stock Soars As Chip Maker Forecasts Rise In Revenue(C) 2020 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
The lawsuit filed Monday by the Culinary Workers Local 226 and Bartenders Union Local 165 against Harrah's Las Vegas and the Bellagio and Signature Condominiums claims the companies have not sufficiently protected workers and their families from the spread of COVID-19 and that rules and procedures for responding to workers who contract COVID-19 have been inadequate. Harrah's is owned by Caesars Entertainment Corp, and the Bellagio and Signature Condominiums are subsidiaries of MGM Resorts International.
[Editor's Note: "Even as Penn National Gaming Stock Rebounds, Consider Other Casino Plays" was originally published April 17, 2020. It is regularly updated to include the most relevant information.]Source: Jeffrey J Coleman / Shutterstock.com What's next for Penn National Gaming (NASDAQ:PENN) stock? Shares have skyrocketed from their lows. With casinos reopening after the novel coronavirus shutdowns, investors are betting on a quick rebound. But, who's to say we'll see a V-shaped recovery at the gaming tables?Casino stocks offer high risk, but high potential returns. Yet, Penn National has pulled back after retracing its past high. But even as shares hold steady around $32 per share, there's many reason why shares could dip further.InvestorPlace - Stock Market News, Stock Advice & Trading TipsFirstly, the company mostly leases the real estate under its casinos. This may have been a smart financial engineering move. But it leaves them fewer liquidity options relative to peers.Secondly, shares trade at a premium to stronger rivals like Las Vegas Sands (NYSE:LVS) and MGM Resorts (NYSE:MGM). This could make them better plays as casino stocks recover, as might VanEck Vectors Gaming ETF (NASDAQ:BJK), which holds all four names in its 42-stock exchange-traded fund portfolio.Also, the recent uptick in new coronavirus cases could delay how quickly casino revenues bounce back. Given the industry's high fixed costs, even a 20% decline in revenue could mean bad news.In short, it may be better to skip out on this "too hot to touch" regional casino play. Let's dive in, and see why PENN stock isn't your "best bet." Penn National Post-PandemicCan Penn National survive the coronavirus? When the pandemic first hit America, Wall Street's answer was a resounding "no" as shares fell from above $39 in February to as low as $3.75 in March. Yet, with its casinos mostly reopened, shares have bounced back more than eight-fold.Will shares continue to climb? That's debatable. On one hand, 70% of its properties have resumed operations. On the other hand, most states are imposing strict social distancing guidelines. This could mean things won't return to 100% for quite some time.But, there's another big risk specific to PENN stock. The company leases, not owns, most of its properties. In fact, the company was a pioneer in the casino REIT (real estate investment trust) trend.In 2013, the company spun off most of its real estate as the first casino REIT, Gaming and Leisure Properties (NASDAQ:GLPI). This transaction allowed them to realize the underlying value of its property. But while this boosted valuation, it left them exposed to heavy lease liabilities.As our own Matt McCall wrote back in April, Penn National carries $8.5 billion in lease liabilities on its balance sheet. In 2020 alone, the company must make $900 million in lease payments. This wouldn't be a problem in normal times. But, what happens if casinos fail to see a V-shaped recovery? It's easy to see how this company could fall short of Wall Street's sky-high expectations.Yet, enthusiasm over the company's moves into sports wagering have sent shares to a highly frothy valuation. With this in mind, things don't look so hot from a risk/return perspective. Sports Betting Catalyst More Than Priced Into SharesThe recent rally in PENN Stock has made shares richly priced. The company's enterprise value/EBITDA (EV/EBITDA) ratio now stands at 15.1. That's a premium to the EBITDA multiples of Las Vegas Sands (11.2) and MGM (13.1).Why have shares reached such a premium valuation? Chalk it up to the company's sports betting catalyst. As I wrote May 29, the company's investment in Barstool Sports could help boost the prospects for their budding sportsbook operations.By partnering with Barstool, the company can market directly to the podcasting network's sports-obsessed, millennial-aged fan base. In short, a viable means to grab market share from first movers like DraftKings (NASDAQ:DKNG) and Fanduel (OTCMKTS:PDYPY).I agree this makes for a valid bull case for Penn National stock. Yet, this catalyst is more than priced into shares. Even as shares have pulled back from recent highs.In other words, the easy money's already been made with PENN stock. Buying today out of pure FOMO may not be the best move. If tangible results in the next quarter or two don't match up with today's expectations, shares could fall back to lower levels. PENN Stock Is Not Your 'Best Bet'Casino reopenings, along with excitement over the company's sports betting catalyst, have led investors to bid up this gaming company's shares as of late. Should you join in, as the stock trades just below all-time highs?Not so fast! PENN stock has more than priced-in its multiple catalysts. If you want to wager on a rebound, consider other casino stocks out there. But skip this one for now.Thomas Niel, contributor to InvestorPlace, has written single-stock analysis since 2016. As of this writing, Thomas Niel did not hold a position in any of the aforementioned securities. More From InvestorPlace * America's 1 Stock Picker Reveals Next 1,000% Winner * 25 Stocks You Should Sell Immediately * 1 Under-the-Radar 5G Stock to Buy Now * The 1 Stock All Retirees Must Own The post Thinking of Buying Penn National Stock? Not So Fast! appeared first on InvestorPlace.
2020 has been a difficulty year so far for most travel and leisure-related companies. And in the first half, among the biggest casualties of the coronavirus pandemic have been hotel stocks.By the end of March, shares in a wide range of hotels hit multi-year lows. Since then, to the delight of market participants, many travel and hotel stocks have recovered at least some of their initial losses. However, despite the increase in shares prices, most hospitality businesses are suffering from a collapse in demand, such as for air travel, car rental or hotel rooms.Year-to-date, the S&P 500 index is down around 7%. Yet that number tells only half the story. If you were brave enough to invest $1,000 in the index after the 52-week low of 2,191.86 seen on March 23, you would now have about $1,400.InvestorPlace - Stock Market News, Stock Advice & Trading TipsWhere do the indices, as well as individual hotel stocks, go from here? It is not an easy question to answer. On Friday, shares across the markets are sharply lower.Broader market action seems to be tied to the news headlines about restarting the economic activity across the world and the number of new Covid-19 cases on a given day. In recent days, volatility is back in the markets as investors seem to be debating between a substantial pick-up in economic activity and fears of a second wave of the pandemic. Experts keep repeating the steps consumers need to follow to stay safe and make it more of the former."We should open the economy gradually and encourage everyone to follow safe practices such as wearing a mask, washing hands frequently, and social distancing," said Sanjiv Sabherwal Goolsby-Fouse, Endowed Chair and Professor of Finance, Department of Finance and Real Estate at University of Texas at Arlington, in an email to InvestorPlace. "Most of these practices, such as wearing a mask, are simple to follow and do not have a high economic cost. Equally importantly, governments should make it possible to do more widespread testing and also contact tracing. The costs of these measures are insignificant in comparison to the costs of economic shutdown."Since the early days of the pandemic, analysts have been wondering which single letter -- i.e., L, U, V, or W -- might best summarize the path of post-coronavirus asset prices. So far, the optimistic expectation is for a quick V-shaped recovery.However, as the number of coronavirus cases once again increases, I'm of the camp that a U-shared recovery is more likely. The U.S. economy will likely spend a longer time laboring in economic contraction rather than immediately rebounding, as would be suggested by a V-shaped recovery. * 7 Blue-Chip Stocks to Avoid Right Now Therefore, some short-term profit taking in many stocks may in fact be due, especially as we approach the earnings season. Today, I'll discuss several three hotel stocks that deserve to your attention for including in long-term portfolios. They are: * InterContinental Hotels (NYSE:IHG) * Hyatt Hotels (NYSE:H) * MGM Resorts International (NYSE:MGM)Any upcoming weakness in their prices would make these hotel stocks quite attractive. Let's take a closer look. Hotel Stocks: InterContinental Hotels (IHG)Source: Cineberg/Shutterstock.com In early May, London, U.K.-headquartered InterContinental Hotels released its 2020 first-quarter trading update. Group Q1 comparable revenues per available room (RevPAR) -- the hotel industry's preferred performance measure -- was down 24.9%. In March, revenue decreased by 55%. Management expects April and Q2 results to be even worse. For example, April revenue was likely around 80% lower than in April a year ago.Chief Executive Officer Keith Barr said, "Covid-19 represents the most significant challenge both IHG and our industry have ever faced." As a result, management has implemented a number of measures to reduce costs and preserve cash across the business. For example, earlier in March management axed the final dividend for the year, saving around $150 million. The move mainly came after the leisure group experienced an almost 90% fall in Greater China RevPAR during February.The group is confident it can continue to operate "for at least 18 months in a theoretical 'zero occupancy' environment." It is a global operation with a heavy concentration in the U.S. and China. Management has also noted that "the Upper Midscale segment, which accounts for around 65% of [its] rooms in the U.S., has historically recovered from faster than other segments."Pandemic-induced travel restrictions coupled with hotel shutdowns have slammed the group's operations. So far in 2020, IHG stock is down more than 35%. It started the year shy of $70. Now IHG shares are around $44. Now that it's below $45, you should put IHG stock on your radar for hotel stocks to buy. Hyatt Hotels (H)Source: EQRoy/Shutterstock.com On May 6, Hyatt reported first-quarter results. Adjusted net loss was $35 million, or 35 cents per diluted share, in Q1 2020, compared to adjusted net income of $48 million, or 45 cents per diluted share, in Q1 2019. Comparable U.S. hotel RevPAR decreased 24.5% and comparable system-wide RevPAR decreased 28.1%.CEO Mark Hoplamazian said, "As COVID-19 became a global pandemic … we obtained substantial additional cash, reduced investment and corporate spending to preserve cash, and we reduced third party hotel owners' direct costs through this period.. Our existing liquidity provides sufficient capacity to cover at least 30 months of operations under current conditions."More businesses reopening stateside and globally means more reason to travel, both for work and leisure. According to recent research by Jalayer Khalilzadeh of the School of Hospitality Leadership at East Carolina University, "Considering past experiences … tourism will be fine in a matter of a year or two after the end of the COVID-19 pandemic." If you too believe that the trend is likely to improve in the rest of the year, then it'd be right to expect Hyatt Hotels to see more robust fundamental metrics in the coming months. * 7 Undervalued Stocks to Buy Year-to-date, H stock is down over 47%, hovering at $53. A price drop toward the $50 level or below would make Hyatt shares attractive in the eyes of many market participants. If you have a 2-3 year time horizon, then you may also want to do further due diligence on the group as one one of the potential hotel stocks to buy. MGM Resorts (MGM)Source: Jason Patrick Ross / Shutterstock.com The MGM Resorts portfolio encompasses 30 hotels and casinos. In the U.S., venues span from Maryland to Massachusetts, Michigan, Mississippi, Nevada, New York, and Ohio.Las Vegas, of course, has a number of resorts, making Nevada the most important state for the group.In China, guests can visit MGM resorts in Macau, Cotai and Diaoyutai. The group is also currently bidding for a gaming license in Japan.Q1 started with a lockdown in China and ended with one in the U.S. According to the the American Gaming Association (AGA), as of the end of March, all 989 commercial and tribal casinos nationwide had closed their doors. As I write, 782 are open, whereas 207 are still closed.Amid the lockdown, MGM Resorts reported first-quarter results on April 30. For the quarter, revenue fell 29% year-over-year to $2.3 billion. Earnings came at $806.9 million.The shares started Jan. 2020 around $34. But as the reality of the global pandemic began to resonate with MGM shareholders, on March the stock hit a multi-year low at $5.90. Since then, the price has almost tripled. Therefore, some profit-taking may be likely in MGM stock, especially as management gets ready to report Q2 earnings. Any drop toward $15 level would make MGM resorts one of the more attractive hotel stocks to include in a longer-term portfolio.Tezcan Gecgil has worked in investment management for over two decades in the U.S. and U.K. In addition to formal higher education, including a Ph.D. degree, in the field, she has also completed all 3 levels of the Chartered Market Technician (CMT) examination. Her passion is for options trading based on technical analysis of fundamentally strong companies. She especially enjoys setting up weekly covered calls for income generation. As of this writing, Tezcan Gecgil did not hold a position in any of the aforementioned securities. More From InvestorPlace * Why Everyone Is Investing in 5G All WRONG * America's 1 Stock Picker Reveals His Next 1,000% Winner * Revolutionary Tech Behind 5G Rollout Is Being Pioneered By This 1 Company * Radical New Battery Could Dismantle Oil Markets The post 3 of the Best Hotel Stocks to Buy as Vacation Travel Ramps Up appeared first on InvestorPlace.
Penn National Gaming (NASDAQ:PENN) is a small casino operator with big ambitions in online gaming. The ambitions are reflected in its 36% stake in Barstool Sports, a sports blog building a sports betting app. What John Maynard Keynes described as the market's "animal spirits" are reflected today in PENN stock.Source: Casimiro PT / Shutterstock.com In 2020, when people are feeling good about the economy, they pile into Penn National stock.In February it peaked at $39/share, and nearly hit that level again in early June. When people are feeling down, they sell Penn National. The shares have traded below $7 this year and have suffered two down moves of over 10% just this month.InvestorPlace - Stock Market News, Stock Advice & Trading TipsPenn National is the ultimate "Dirty Harry" stock. Feeling lucky, punk? The Bull Case for PENN StockWhat the bulls see in Penn National is its potential sustained by cash flow.Penn National has brought in $5.1 billion of revenue in the last year and had $1.1 billion in the March quarter. It's only nominally profitable but generated $843 million of operating cash flow in 2019. * 10 Consumer Stocks to Buy to Ride the Post-Covid-19 Wave Penn National spent $450 million for a 36% share of Barstool in January. Barstool founder Dave Portnoy has since been all over TV like a wrestling promoter, talking up a rivalry with DraftKings (NASDAQ:DKNG) and Flutter Entertainment (OTCMKTS:PDYPY). Many of Flutter's betting parlors go by the name Paddy Power.Portnoy acts like online sports betting is a huge business in the U.S. The fact is it's only legal in 7 states and not all are operating. Most states that allow sports bets only do it in casinos. Regulation is a patchwork, but bulls expect a flurry of legislation next year, as states try to patch holes in their budgets created by COVID-19.Penn National started with horse racetracks (where you sit down right on the horse). It began buying casinos, mainly in the south, 20 years ago. Its best known property is Las Vegas' Tropicana but it has 38 in all, most with names like Hollywood Casino, Boomtown and Ameristar. The Bear Case Against Penn NationalBears see a small casino operator punching above its weight.Penn National's market cap today is about equal to its 2019 revenue. MGM Resorts (NYSE:MGM), by contrast, sells for just two-thirds of its 2019 revenue. Penn National's premium valuation is based on the sports book.DraftKings has a market cap of $13.25 billion, about 40 times its 2019 revenue. It also has a scaled technology partner to operate sports betting. Flutter, which operates in Europe, has one too. Flutter has a market cap of about $21.7 billion, twice that of DraftKings, with 2019 revenue of $2.1 billion.Penn National's online action is being handled by Kambi, a European operator owned by Unibet, a Swedish company worth about $1.2 billion. It has arrangements with DraftKings as well.It's the size and profitability of the U.S. online sportsbook, and Penn National's ability to gain market share in it, that worries the bears. Penn National has been reopening its casinos aggressively, and COVID-19 has responded by spreading aggressively. Penn National's near-term fate is tied up in the casinos, as our Thomas Niel notes. The sports book is all speculation. The Bottom LineWhen times are good and money flowing, casinos can be a cheap night out.But times are not good right now, and money is not flowing. Penn National's re-opening efforts look doomed to fail as COVID-19 cases continue to spike.The sports betting bonanza may not be as big as Penn is playing it, either. Flutter is scaled and active, but only does $2 billion in business a year. That's less than half of Penn's handle in its casinos.Even if you want to be in Penn National, you might want to wait a few weeks and see how bad the latest outbreak is. Let the virus be your guide, and don't get in until you see it receding.Dana Blankenhorn has been a financial and technology journalist since 1978. He is the author of the environmental thriller Bridget O'Flynn and the Bear, available at the Amazon Kindle store. Write him at email@example.com or follow him on Twitter at @danablankenhorn. As of this writing he owned no shares in companies mentioned in this story. More From InvestorPlace * Why Everyone Is Investing in 5G All WRONG * America's 1 Stock Picker Reveals His Next 1,000% Winner * Revolutionary Tech Behind 5G Rollout Is Being Pioneered By This 1 Company * Radical New Battery Could Dismantle Oil Markets The post Don't Bet on Penn National Gaming Stock Until Casinos Start to Level Out appeared first on InvestorPlace.
MGM and Caesars are both doubling down in their efforts to combat Covid-19 with new rules requiring all guests and patrons to wear face masks.
MGM Resorts International said it will require that all guests wear face masks inside public spaces at all of its U.S. outlets effective Friday, as it moves to upgrade safety measures during the coronavirus pandemic. Previously, the casino operator only required employees to wear masks. The U.S. recorded a one-day total of 34,700 new confirmed COVID-19 cases on Wednesday, the highest level since late April, when the number peaked at 36,400, according to data aggregated by Johns Hopkins University. Infections are rising in 29 states, according to a New York Times tracker. "It is clear that the coronavirus still presents a significant public health threat, and masks have proven to be one of the best ways to curtail the spread," MGM said in a statement. "We want guests and employees to feel comfortable that we are putting their health and safety first." MGM shares were down 2.2% premarket and have fallen 49% in the year to date, while the S&p 500 has fallen 6%.
MGM Resorts International (NYSE: MGM) today announced that it will require masks for all guests and visitors inside public spaces at every MGM Resorts property in the United States. The Company previously required all employees to wear masks, while guest and visitor mask requirements were based on local regulations.
MGM Resorts International (NYSE: MGM) today announced the release of the 2019 Social Impact and Sustainability Report Focused on What Matters: Embracing Humanity. Protecting the Planet. The report builds on the Company's commitment to create a more sustainable future, while striving to make a more positive impact in the lives of its employees, guests and in the communities where the Company operates.
At the bottom of the COVID-19 stock rout in March, MGM Resorts International (NYSE:MGM) traded at $7.14 a share. MGM stock opened June 16 at over $21.Source: Michael Neil Thomas / Shutterstock.com If you bought at the bottom you're sitting pretty. If you're buying now, you may believe you have a bargain. MGM's market cap remains below $10 billion, against 2019 revenue of almost $13 billion and net income of over $2 billion.MGM has been announcing casino re-openings for several weeks. So far, so good. Four more Las Vegas casinos will be open by July.InvestorPlace - Stock Market News, Stock Advice & Trading TipsThat means MGM's June quarter, to be reported July 30, should be the bottom, with revenue of $581 million expected. Put It on BlackMGM is the second-largest casino operator after Las Vegas Sands (NYSE:LVS), but it's more diversified and financially creative than its larger rival. * 10 Robotics Stocks on the Technological Cutting Edge In a 2018 analysis, only 25% of MGM's casino revenue came from Las Vegas. But half its overall revenue came from Vegas, thanks to its hotels, restaurants, and entertainment venues. The rest was split between Macau and "regional properties," like Mississippi casinos that opened again this month.MGM's real estate is held by a separate company, MGM Growth Properties (NYSE:MGP), currently worth slightly more than MGM itself. MGM Growth is a friendly landlord, giving Resorts $700 million in liquidity during May through "operating partnership units." This also gives investors another way to play MGM.MGM management has also been lucky, not just good. In January, just before the virus hit, MGM sold its two biggest real estate properties, the MGM Grand and Mandalay Bay, to a joint venture of MGM Growth and a unit of Blackstone Group (NYSE:BK) for $4.6 billion.All this means MGM is still cash rich. MGM Resorts had $6 billion in cash at the end of March. Put It on RedDespite its highly-publicized re-openings MGM remains a troubled company.Just because a casino is open doesn't mean it's busy. Las Vegas authorities are offering happy talk since gaming and hospitality employ one-third of Nevada workers. The industry is hoping that "safety shields" which separate players from each other at tables and on slot machines will minimize risk.Some workers remain unconvinced. It's one thing to risk your life in a hospital or grocery store, another to risk it at a gaming table.MGM's Macau properties, the first of its operations to re-open, had just 10 tables open May 7, and 20 slot machines. Traffic at second-tier casinos seems to be coming back faster. Locals can gamble while travel restrictions keep many high rollers out.MGM furloughed 63,000 workers when the virus hit. While it's still paying health insurance through August, at least some layoffs are expected in September. Gaming experts warn that careful planning is necessary in reopening and this reduces the handle.It's for these reasons that UBS recently dropped its price target on MGM stock. Tipranks still has three bulls on MGM, one bear, and 11 sitting on the fence. Their average price target, however, is just $17.11, 20% below the June 16 opening price. The Bottom Line on MGM StockMGM may be the most creative and best-run casino operator there is. Of all the gambling giants, it's best equipped to handle a second shutdown. But that doesn't mean you put all your money on black.There's another way to play, namely MGM Growth. Assuming the main company can make its rent payments, you have a yield of 6.5% coming. If there is a second shutdown, or gamblers fail to materialize, you still have the real estate. An MGM bankruptcy, for you, would just mean new stock players at your table.Dana Blankenhorn has been a financial and technology journalist since 1978. He is the author of the environmental thriller Bridget O'Flynn and the Bear, available at the Amazon Kindle store. Write him at firstname.lastname@example.org or follow him on Twitter at @danablankenhorn. As of this writing he owned no shares in companies mentioned in this story. More From InvestorPlace * Why Everyone Is Investing in 5G All WRONG * Top Stock Picker Reveals His Next 1,000% Winner * The 1 Stock All Retirees Must Own * Look What America's Richest Family Is Investing in Now The post Should You Bet on MGM Resorts or MGM Growth? appeared first on InvestorPlace.
ROAR Digital, LLC – the joint venture between MGM Resorts International (NYSE: MGM) and GVC Holdings (LSE: GVC) – and the Confederated Tribes of Grand Ronde, announced today a long-term partnership. ROAR Digital will be the Tribes' exclusive sports betting partner.