Boyd Gaming (NYSE: BYD) simply beats first-quarter estimates, fueled by power in downtown Las Vegas venues, sparking a brand new spherical of bullish feedback from Wall Road analysts within the course of I used to be.
The operator of Fremont On line casino earned $1.71 per share on earnings of $963.97 million for the January-March interval. The analyst anticipated a revenue of $1.54 on gross sales of $889.59. In opposition to the backdrop of those sturdy outcomes, no less than 5 of her sell-side her analysts have raised Boyd’s worth targets. That group consists of Stifel Steven Wieczynski, who raised the worth forecast for the native on line casino operator from $81 to $83. This represents a rise of about 25% for the reason that April 25 closing worth.
After mid-2023, the comparisons begin to get harder, however we imagine investor expectations for regional gaming general will stay considerably benign even with a harder comparability, so BYD stays stable going ahead. We’re assured it is going to ship outcomes,” Wieczynski wrote in a observe to the consumer. “With a wholesome and subdued stability sheet, BYD is a good identify to personal in any surroundings, particularly provided that the near-term outlook stays unsure. ”
On the finish of March, Boyd had $263.5 million in money and $3 billion in debt. The corporate’s stability sheet is actually sturdy, as highlighted by its buyback of $106 million price of shares within the January quarter. Boyd has $133 million left over from his beforehand introduced buyback plan.
Downtown Las Vegas Boosts Boyd
Boyd operates 10 gaming venues in Dwelling Markets, together with Aliante, California, Cannery, Fremont, Gold Coast, Joker’s Wild, Foremost Road Station, Sam’s City, Suncoast and The Orleans.
The California, Fremont, and Foremost Road stations are situated in downtown Las Vegas, which is a plus for the operator if there is a rise in guests to that space of Sin Metropolis.
As extra individuals go to Las Vegas, an increasing number of individuals cease by downtown throughout their keep. He stories that 58 p.c of Las Vegas guests visited downtown Las Vegas final yr,” Keith Smith, his CEO of Boyd, stated on a convention name. “This improve in customer numbers is benefiting all three of his downtown properties.”
Smith additionally underscored the power of Boyd’s longtime, devoted Hawaii guests, pointing to a ten% year-over-year improve in play amongst these clients on the operator’s downtown venues. backside.
Throughout from California, the Foremost Road Station is within the midst of renovations which are anticipated to be accomplished in late 2023. As that occurs, all three of his venues in downtown Boyd shall be renewed within the final two years.
Along with the Las Vegas property, Boyd operates 18 on line casino inns in 9 different states.
Void inventory reductions are unfair
As Stifel’s Wieczynski factors out, Boyd owns nearly all actual property, a 5% stake in FanDuel, and boasts a wholesome stability sheet, however the inventory is undervalued relative to its friends.
BYD believes the FCF yield ought to commerce round 7%-8%, which suggests the inventory is price $80-$90.
Boyd does not seem like clouding its funding image with an acquisition, as Smith informed analysts on a convention name that there is “nothing fascinating” in the intervening time a couple of potential merger.
