Let’s dig into the relative performance of MGM Resorts (NYSE: MGM) and its peers as we unravel the now-completed Q1 casino operator earnings season.
Casino operators enjoy limited competition because gambling is a highly regulated industry. These companies can also enjoy healthy margins and profits. Have you ever heard the phrase ‘the house always wins’? Regulation cuts both ways, however, and casinos may face stroke-of-the-pen risk that suddenly limits what they can or can't do and where they can do it. Furthermore, digitization is changing the game, pun intended. Whether it’s online poker or sports betting on your smartphone, innovation is forcing these players to adapt to changing consumer preferences, such as being able to wager anywhere on demand.
The 9 casino operator stocks we track reported a slower Q1. As a group, revenues were in line with analysts’ consensus estimates.
Luckily, casino operator stocks have performed well with share prices up 17.3% on average since the latest earnings results.
MGM Resorts (NYSE: MGM)
Operating several properties on the Las Vegas Strip, MGM Resorts (NYSE: MGM) is a global hospitality and entertainment company known for its resorts and casinos.
MGM Resorts reported revenues of $4.28 billion, down 2.4% year on year. This print was in line with analysts’ expectations, and overall, it was a satisfactory quarter for the company with an impressive beat of analysts’ EPS estimates but a significant miss of analysts’ EBITDA estimates.
"MGM Resorts achieved strong first quarter results across our portfolio in the face of the well anticipated comparison to last year's Super Bowl in Las Vegas, highlighted by a positive EBITDA performance at our BetMGM venture," said Bill Hornbuckle, Chief Executive Officer & President of MGM Resorts International.
Interestingly, the stock is up 18.1% since reporting and currently trades at $37.13.
Is now the time to buy MGM Resorts? Access our full analysis of the earnings results here, it’s free.
Best Q1: Monarch (NASDAQ: MCRI)
Established in 1993, Monarch (NASDAQ: MCRI) operates luxury casinos and resorts, offering high-end gaming, dining, and hospitality experiences.
Monarch reported revenues of $136.9 million, up 6.8% year on year, outperforming analysts’ expectations by 5.4%. The business had an exceptional quarter with an impressive beat of analysts’ EPS estimates and a solid beat of analysts’ adjusted operating income estimates.
Monarch pulled off the biggest analyst estimates beat and fastest revenue growth among its peers. The market seems happy with the results as the stock is up 20.3% since reporting. It currently trades at $105.
Is now the time to buy Monarch? Access our full analysis of the earnings results here, it’s free.
Weakest Q1: PENN Entertainment (NASDAQ: PENN)
Established in 1982, PENN Entertainment (NASDAQ: PENN) is a diversified American operator of casinos, sports betting, and entertainment venues.
PENN Entertainment reported revenues of $1.67 billion, up 4.1% year on year, falling short of analysts’ expectations by 1.6%. It was a disappointing quarter as it posted a significant miss of analysts’ EBITDA estimates and a significant miss of analysts’ EPS estimates.
Interestingly, the stock is up 16.8% since the results and currently trades at $18.35.
Read our full analysis of PENN Entertainment’s results here.
Red Rock Resorts (NASDAQ: RRR)
Founded in 1976, Red Rock Resorts (NASDAQ: RRR) operates a range of casino resorts and entertainment properties, primarily in the Las Vegas metropolitan area.
Red Rock Resorts reported revenues of $497.9 million, up 1.8% year on year. This number topped analysts’ expectations by 0.6%. More broadly, it was a satisfactory quarter as it also recorded an impressive beat of analysts’ EPS estimates but a miss of analysts’ Casino revenue estimates.
The stock is up 30.3% since reporting and currently trades at $54.88.
Read our full, actionable report on Red Rock Resorts here, it’s free.
Boyd Gaming (NYSE: BYD)
Run by the Boyd family, Boyd Gaming (NYSE: BYD) is a diversified operator of gaming entertainment properties across the United States, offering casino games, hotel accommodations, and dining.
Boyd Gaming reported revenues of $991.6 million, up 3.2% year on year. This result beat analysts’ expectations by 2.1%. Taking a step back, it was a mixed quarter as it also produced a decent beat of analysts’ EPS estimates but a miss of analysts’ adjusted operating income estimates.
The stock is up 24.3% since reporting and currently trades at $81.95.
Read our full, actionable report on Boyd Gaming here, it’s free.
Market Update
Thanks to the Fed’s series of rate hikes in 2022 and 2023, inflation has cooled significantly from its post-pandemic highs, drawing closer to the 2% goal. This disinflation has occurred without severely impacting economic growth, suggesting the success of a soft landing. The stock market thrived in 2024, spurred by recent rate cuts (0.5% in September and 0.25% in November), and a notable surge followed Donald Trump’s presidential election win in November, propelling indices to historic highs. Nonetheless, the outlook for 2025 remains clouded by potential trade policy changes and corporate tax discussions, which could impact business confidence and growth. The path forward holds both optimism and caution as new policies take shape.
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