Las Vegas / gambling stocks this year

I recently noticed that Schwab's Casino and Online Gambling sector has declined by over 10% in the past year, despite all the buzz and activity in Las Vegas. This piqued my interest, leading me to delve deeper into the matter.

It's noteworthy that only a few stocks in this sector have outperformed the S&P 500, which has increased by 20% over the past year and 15.5% year-to-date.

Stocks linked to Macau, China, such as Las Vegas Sands (LVS), Wynn Resorts (WYNN), and Melco Resorts (MLCO), have experienced significant declines in their stock prices. This may be attributed to factors affecting the Chinese market, including changing regulatory conditions imposed by a business-unfriendly Chinese government and broader economic factors.

One-year return:

LVS: -31.5%
WYNN: -22.9%
MLCO: -52.6%

Domestic stocks have performed notably better over the past year.

Boyd Gaming (BYD): -18%
Red Rock Resorts (RRR): +16.8%
Sphere Entertainment (SPHR): +14.49%

Interestingly, SPHR's year-to-date performance has been even better, with a 26.8% increase. This might reflect the enthusiasm (or overhype) surrounding Sphere and its impact on the Las Vegas entertainment scene.

Most casino and gambling stocks have underperformed the tech-heavy S&P 500 this year. However, any gambling stocks with exposure to China have been hit hard.

I've always been interested in the business side of Las Vegas. Over the years, my contributions (losses) to the casinos have undoubtedly helped in their success. I might consider writing more about this sector soon.

(7/22/24)

Very interesting, Bart, and thank you for your "delving" and sharing of this information.

Candy

I don't think I would consider Shere Entertainment a "Casino and Online Gambling" stock, as far as I know, it owns Sphere and MSG networks.

Thank you for reading my post. You are right. Sphere Entertainment is not included in the Schwab "Casino and Online Gambling" theme focus. 

Schwab does, for example, include VICI Properties (VICI) in its casino focus. VICI is listed as also having "four championship golf courses" and "39 experiential (nongaming) properties," as well as 54 gaming properties (including Caesars, The Venetian, and The Borgata in Atlantic City).

That said, Sphere has undeniably made a significant impact on the Las Vegas scene. Therefore, I believe it deserves consideration in any stock focus related to "Las Vegas Gaming and Entertainment." It has undoubtedly altered the Las Vegas landscape, for better or worse. LOL

Las Vegas Sands left the   Vegas market for what they thought was better growth in Macau.    I bet they wish they could have a do-over on that one.    

I used to believe that investing in gaming technology, especially slot machines, would be a guaranteed way to make money because of their widespread presence in casinos. It turns out I was wrong!

International Gaming Technology or IGT  (developer and distributor of icon slot machines like "Wheel of Fortune," "The Price is Right," "Jeopardy!" "Double Diamond," and "Family Feud") is down over the last year by more than 30%.

If fact. if you invested $10,000 in IGT on November 28, 2007 (near its all-time high), your investment would now be worth $9,166 (down 8%), while that same $10,000 invested in the S&P 500 would be worth $52,500 (up 425%).

Little wonder Apollo Global Management, a financial group, plans to acquire IGT and take the company private.

It appears that someone is benefiting from those slot machines, but it doesn't seem to be the stockholders.