Las Vegas Sands, Boyd Gaming And Red Rock Resorts: Gambling Stocks With New Highs
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It’s the ultimate “consumer discretionary” stock: the gambling company with the locations where consumers show up with money to blow. These firms may lack the elegant charm of a JP Morgan or a BancAmerica, but as alternative financial institutions, these shares are finding buyers who don’t care.
You don’t need a Martin Scorsese movie to know how this works.
Casinos offer games and so visitors with wallets open try their hand at roulette, craps, blackjack and those devices formerly known as one-armed bandits but which now make do with mere well-lit buttons waiting to be pressed. Over and over.
Sports books in casinos also attract the riveted attention of bet makers with pro football, pro basketball, pro baseball, college games and even that old favorite, horse track racing, on the menus. It’s hard to beat the spread as anyone who’s spent more than 10 minutes in such an establishment can testify.
At the end of the day, a decently run operation does a better job of banking the money than your average Silicon Valley financial services branch office. That’s why these casino stocks keep making new highs lately — investors have noticed how the earnings tend to stay pleasantly elevated recently.
Las Vegas Sands just beat the earnings expectations of analysts and that’s what serious investors like the most, so it’s blasting upward to a new high. This year’s EPS grew at 7.60%. The past 5-year record is -20.20%. The profitability of their Macao resort is attracting the attention of those analyzing bottom lines.
Market capitalization of Las Vegas Sands is big: $47.62 billion. No dividend is paid and long-term debt exceeds shareholder equity by 3 and 1/2 times, so it’s not exactly a value stock, at least in the traditional sense.
Here’s the daily price chart:
It’s trading above both the 50-day moving average (the blue line) and above the 200-day moving average (the red line) and both are in uptrend mode, the condition considered most favorable. Note that the relative strength indicator (RSI, below the price chart) is showing the beginning of a negative divergence.
Boyd Gaming is another of the old names among Las Vegas casinos with locations these days in Indiana, Louisiana, Mississippi and Kansas City. Earnings this year are up by 44.30% and for the past 5 years by 44.40%. Market capitalization is $7.01 billion. Boyd pays a dividend of .92%.
The daily chart looks like this:
It’s another Las Vegas-based casino stock with the strong upward trend keeping it above both of the significant moving averages on the chart. The 50/200-day crossover in mid-December, 2022 is working.
Red Rock Resorts is smaller than Las Vegas Sands or Boyd Gaming with a market capitalization of just $5.03 billion. The Las Vegas-based, NASDAQ-traded stock has an average daily volume of 471,000 shares.
Earnings per share over the most recently reported 12-months are up by 61.70% and, for the past 5-years, by 26.40%. Red Rock Resorts has long-term debt that comes to 68 times its shareholder equity (wow!). The company pays a 2.05% dividend.
The daily price chart is here:
The stock that traded at $33 in October, 2022 now goes for $48.80. The 50/200-day moving average crossover came in early December, 2022 and this is another one where the generally bullish indicator called it correctly.
