Big Gaming was liberated from hundreds of millions of dollars in market capitalization yesterday, as the stock market went into shock. So burdensome, all that money. The Dow Jones average plunged nearly 1,680 points before hitting bottom and gaming stocks suffered disproportionately from tariff-related woes on Wall Street. Kudos to the oft-lamentable Las Vegas Review-Journal for covering a story which the legacy media has otherwise done its best to ignore.
Macao-facing casino companies felt the brunt of it, as one might expect. Wynn Resorts shares plummeted over 10.5% as The Street recoiled in horror from “Liberation Day.” MGM Resorts International dropped 9% and Las Vegas Sands (which is exclusively overseas now) was relatively spared, stopping just short of -7%. Domestic companies got walloped too, especially if they have heavy exposure to Las Vegas. Strip-centric Caesars Entertainment was down 9.5% as was Sin City-exclusive Station Casinos (the company with the most to fear from a recession). Golden Entertainment, whose business model is a bit shaky at this point, was dropped for a nine-point loss and Boyd Gaming got off easy with a 6% decline, perhaps shielded by its regional diversification. Speaking of Vegas-centric, Allegiant Air wasn’t spared, diving 12%.
Those tariff-ying numbers don’t require much elaboration. The United States has just committed economic seppoku and the casino industry is already suffering the consequences. Big Gaming likes to claim that it’s recession-resistant (although the Crash of 2008 found that fiction out). That old saw is about to be put to the test … again.
Shoot the messenger: Caught having talks with DraftKings and FanDuel, leaders of California‘s tribal casino industry took a page from the White House playbook. They put the blame on reporter Jill Dorson for telling what she saw at a sensitive meeting to which she was invited. (There’s a lot of that going that around these days.) Jefferies Equity Research analyst David Katz took the Dorson article and ran with it, prompting tribal bosses to deny that what happened really happened. Uh huh.
Major private-sector OSB operators, via the Sports Betting Alliance, sat down with the Golden State’s tribal-gaming powers this week … and let Dorson in on it. After word of the on-the-record parlay got out, the Indian alphabet soup of IGA, CNIGA and TASIN circled the wagons to denounce the private operators and Dorson alike. They huffed in unison that the leak showed which such discussions were best organized by themselves, not the SBA. This was definitely an own-goal by the Alliance, which just set itself back in its attempts to penetrate California.
Since the OSB powers-that-be have acknowledged that they have to go through the tribes to get to the Promised Land, some serious groveling is now in order. Anything else would be what the tribes call a “false illusion.” (As opposed to a true illusion?) As for Dorson, good work. Keep it up.
Jottings: The legacy media is belatedly picking up on a story we highlighted two days ago. The question going forward should be whether a $115 million escalator clause agreed to by Bally’s Corp. amounts to a kickback—not to mention whether Bally’s actually has the money to pay it, being grossly overextended at the moment … The Downtown Grand, the casino where you can hear a pin drop on the carpeted floor, has an unlikely savior. Rolling Stone‘s owner is looking at getting into the gambling biz, hoping to monetize the brand the way Hard Rock International has done. The Grand will be a tough row to hoe, so we wish them luck. At least the price of entry is a steal: $30 million … Illinois is getting its first racino. 270 slots will be installed at Fairmount Park, providing a welcome distraction during the long lag time between races … Urban One, whose repulsive, race-baiting campaigning cost it a Richmond casino, is back although nobody seems to have missed them. CEO Alfred Liggins III wants to get the company into i-gaming. He’s left it awfully late, though …
Praise be to MGM China for a new, environmentally friendly initiative. Casinos burn through packs of playing cards at an astonishing rate. Now MGM is partnering with Fnetlink Technology Co. of Macao to recycle 100% of the cards into packaging materials. It’s a great idea and, if it works, we hope they bring it stateside … In a rare coup, BallyBet has inked a deal to become Mississippi‘s “preferred” sports book provider. Finalized just in time for the Sweet 16, the pact covers Bally’s Vicksburg and Hard Rock Biloxi. The accord also enables punters to resell their tickets to suckers, er, others. Unfortunately for everyone, Mississippi politicians continue to be too obtuse to legalize online sports wagering … A massive concert hall and 2,000-plus slot machines are on tap for Graton Resort & Casino, part of a $1 billion expansion. With Las Vegas being built out for the time being, the tribal resorts are where it’s at … To end on a positive note, Boomtown Biloxi is restoring its buffet after a five-drought. Let’s hope it’s on the cutting edge of a trend.