It just so happens that I share my birthday with the notorious World War I double agent Mata Hari. Hopefully I will come to a better end than she did. I’ve been enmeshed in a huge project for CDC Gaming Reports that’s kept my hands full lately. Also, today is my birthday, so I’m taking it slightly easy. Tomorrow will bring dispatches from Atlantic City and Massachusetts, as well as a ranking of the best movies set in casinos. See you then.
Sounding pleased with Wynn Resorts (“Upside across the board”), J.P. Morgan analyst Joseph Greff lauded its 2Q23 performance as “solid,” without budging from his “Overweight” rating or $142/share price target. That’s despite Wynn blowing past Greff’s cash-flow estimates for Macao, Las Vegas and Boston. Lower-than-usual hold in mass-market play undid better-than-usual retention of VIP gambling money in Macao but surpassed cash-flow projections by at least $10 million. Mass-market table action hit 91% of pre-Covid levels, as the enclave continues its faster than expected comeback. Retail sales were described as “strong,” while Wynn’s Macanese hotels ran at 96% occupancy.
Also firing on all cylinders was Wynncore, which scored better-than-expected marks in gambling, room rates, F&B and even the troubled entertainment program. Las Vegas-derived revenues of $578 million far overshot Wall Street‘s anticipation. Ditto cash flow. Room rates were an astronomical $462/night as “the high end continues to outperform.” While slot coin-in was but 88% of 2Q19 altitudes, table games more than compensates, seeing 127% as much wagering.
Continue reading Macao powers Wynn; Indiana down, Missouri flat
Like bad sex, the connubial bliss between Penn Entertainment and Barstool Sports ended abruptly. Cretinous Dave Portnoy becomes someone else’s problem child following the second-quarter-earnings revelation that Barstool was being sold back to its founder, jilted in favor of much comelier ESPN. Considering Penn’s down-market image, ESPN is doing the company a favor by lending its prestige to a company that has dragged its own name through the mud in pursuit of a sadomasochistic marriage to Portnoy.
“Well, it was fun while it lasted, but, in our view, the handwriting has been on the wall for some time,” wrote Deutsche Bank analyst Carlo Santarelli. “The Barstool partnership was not working, the risks were too significant, and PENN was at a crossroads.” Penn chose to “double down with a new strategy,” opined the pundit. He explained that Penn’s reversal “likely speaks to what is presumably a tough road for its core [brick-and-mortar] business on the horizon, as regional gaming rationalizes from post pandemic peaks and competition hampers performance at core PENN assets.” Barstool Sportsbook will become ESPN Bet. Santarelli believes this is in itself a positive, as the Barstool brand wasn’t what it was cracked up to be as a customer-acquisition tool. (Just a bunch of tools.)
Continue reading Portnoy, Penn splitsville; Full House fire sale?
Gaming industry bears are going to latch onto a 4% drop in Maryland gambling earnings as evidence of an impending recession. Thankfully, J.P. Morgan analyst Joseph Greff puts it in context by pointing out that the $174 million haul is 17% higher than July 2019, itself a high-water mark at the time. The Free State moves closer to a duopoly, with MGM National Harbor (41%) and Maryland Live (36%) capturing more than three-fourths of all business. That left woebegone Horseshoe Baltimore, the casino that Caesars Entertainment forgot, with just $16 million, 13% below last year and 17% down from 2019. MGM, meanwhile, raked in $72 million, a 6.5% slippage, while Maryland Live booked 63%, up 2%.
Continue reading Maryland down, Illinois up; NFL hypocrisy; Bally’s biz
Developer Larry Silverstein‘s PR peeps released additional renderings of The Avenir over the weekend and they are certainly impressive. Few additional details of the proposed resort have been made available but the striking exterior is the work of veteran casino architect Paul Steelman, far outdoing his work for Resorts World New York. For our money, it’s pretty much a tossup between this and Sands Nassau for the most curb-appealing design statement and we hope that New York State authorities will have a hard time choosing between the two. If a casino simply must go into Manhattan, Silverstein gets our vote hands down. More pretty pictures after the jump.
Continue reading Big Apple dream; BetMGM welshes; Dekkers: Mom’s to blame
“If you were surprised you haven’t been paying attention.” So wrote Deutsche Bank analyst Carlo Santarelli of yesterday’s Station Casinos earnings release. He added, “it should come as no surprise that RRR reported results that were softer than our forecasts,” which were in themselves pessimistic. Station execs pointed to tough 2022 comparisons, especially in April, as well as their sports books getting cleaned out by Las Vegas Golden Knights bettors. Almost a million dollars of incremental utility costs also accounted for the miss and the latter factor should be considerably worse next quarter. Summarized Santarelli, “if you paid attention to [Boyd Gaming], you got almost exactly what you would have expected from RRR this evening.”
Continue reading Wall Street: Station soft; DraftKings impresses, Bally’s doesn’t
J.P. Morgan analyst Joseph Greff was pretty blunt about MGM Resorts International‘s mixed bag of 2Q23 numbers. “Carried by Macau,” he headlined his report, adding that the Las Vegas Strip was in line with expectations but regional casinos came up short. Of $3.9 billion in net revenue, $2.1 billion came from Sin City but the biggest noise was heard out of Macao, where revenues shot up from $143 million last year to $741 million this year. The Las Vegas numbers were but a $9.5 million improvement on 2Q22 while regional casinos slipped 3.5% to $926 million. Inside the Vegas result were some interesting stats: MGM appears to making its nut off hotel occupancies (96%), where revenues nudged 2% higher while casino haul was 4% down. Slot coin-in rose 13%, barely outpacing house win that was up 12%. Table wagering was up 4% but win only 2% higher.
Continue reading Bears and bulls at MGM; Uwazurike spells “idiot”
Although Las Vegas numbers from Caesars Entertainment were modestly down in 2Q23, as people visit Sin City more but gamble less, analysts were largely pleased with the results. Why not? A robust, $64 million improvement in the digital sphere of the Roman Empire more than made up for any declivity on the Las Vegas Strip. Online operations even posted an $11 million positive ROI, a sign that Caesars has turned the corner on Internet wagering. True, Wall Street didn’t execute cartwheels in the aisles, indicating that the CZR numbers were in line with what was expected. But stock analysts seemed generally satisfied.
Continue reading Afterglow at Caesars; Trouble at Resorts World; Gridiron goof
Continued strength in casinos was shown by Ohio, which posted $193.5 million in gambling revenue in June. That’s 2% higher than already-strong last year and a whopping 20% over 2o19, which was none too shabby either. Hollywood Columbus came out roaring, up 10% to $23 million, which still wasn’t enough to catch slots-only MGM Northfield Park, gaining 5% to almost reach $25 million. Churchill Downs‘ joint-venture Miami Valley Racing vaulted 12% and into second place among racinos with $19 million, besting Scioto Downs, down a point to $18.5 million. Other casinos not doing too shabbily were Jack Cleveland, flat at $22 million, and Hard Rock Cincinnati, off a point to $20 million. Hollywood Toledo was an also-ran with $18 million, minus 2.5%.
Continue reading Ohio up; Golden struggles; Bay State blunders
While not as bad as Deutsche Bank expected (-8%), June revenues on the Las Vegas Strip of $727 million were a disappointment, down 1%. And May’s brief flurry of hope from Las Vegas locals players faded fast as their losses tumbled 10% to $229 million.The problem on the Strip can be summed up in one word: baccarat. The house got clobbered as winnings plunged 29% on 3% larger wagering. By contrast, all other table games were up 9% despite 14% thinner betting. Slot play was up 12.5%, translating to 4% more win for the house.
Continue reading Strip flattens, locals fade; Analysts mixed on Boyd