“Boyd Clean” has been unveiled by eponymous Boyd Gaming and while nothing in it will come as a shock, it shows the company has been closely following what other companies are doing in terms of safety precautions. You’ll receive a “health screening” upon arrival and be offered a bottle of hand sanitizer. You’re “encouraged” to wear a mask. There will be multiple daily cleanings of slots, table games, chairs, restaurants, kitchens, restrooms, doors, ATMs, kiosks, etc. (The list is admirably infinite.) HVAC systems will be cleaned more often and air filters more frequently replaced. Seating both in the casinos, and in restaurants and bars, has been “reconfigured” to compel social distancing. Employees won’t necessarily be wearing masks (although it’s mandatory in food service) but will have that option. No buffets, either.
You’ll get more towels in your room, which will have received a deep cleaning prior to check-in. Daily room cleaning, however, is temporarily suspended in order to limit the number of people traipsing through your suite. Single-use menus, condiments and napkins are in. Congregating behind players (we’re looking at you, craps pit) “is discouraged.” No more fiddling with your cards, either. The dealer will lay them out face-up and it’s ‘hands off’ for you. Oh, and four people to an elevator.
Meanwhile, Boyd CFO Josh Hirsberg was taking virtual meetings with JP Morgan analysts, whose take was “incrementally positive on the potential for pent-up demand from the regional gaming customer.” They nudged their price target up a dollar to $21. Boyd “expects that even with social 
distancing measures in place, most properties should have enough supply to handle demand.” Three casinos in Louisiana reopen today, the other two next week; the two Mississippi casinos are green-lit to reopen tomorrow. “Amenities will be limited to start, and the hope/expectation is that certain less profitable amenities (e.g., buffets) may not return. Management expects that following an initial surge in demand upon reopening, business levels will normalize over time, and the company plans to ramp up its opex/labor gradually.”
Comps and promos will be “selective,” targeted to high-value customers. In the deep South, Boyd is leading with its gaming offerings, as well as low-capacity hotel bookings, with less-profitable sectors coming on line later. Boyd hasn’t been idle during Coronavirus, fast-tracking slot 
system upgrades and “other efficiencies” that weren’t planned until 2021. Trading revenue share for market access, Boyd plans to lean on its partnership with FanDuel going forward, using sports betting as a small-margin leader rather than a profit center, to bring customers through the door. The company is also taking a more serious look at Internet gaming, proving once again that necessity is the mother of invention.
* JP Morgan‘s Joseph Greff also met online with Penn National Gaming CEO Jay Snowden (pictured) and CFO Dave Williams, and found them “upbeat.” The main takeaway was the same as with Boyd (regional rebound), motivating Greff to push his price target all the way up from $21/share to 
$28. Penn opened all five of its Louisiana casinos today and was “encouraged by the volume of customers it saw, many of which were new faces.” The 25% capacity cap is a blessing in disguise: Since it includes closed spaces like restaurants that means the casino floor can run at 50% occupancy. Penn “is not overly concerned with this limitation, noting that aside from its busiest weekend times, pre-COVID-19 utilization rarely exceeded 50%.” Five more Mississippi casinos will reopen sometime this week, bringing a quarter of Penn’s portfolio back into play. Illinois, Maine and Massachusetts are expected to be laggards, reopening sometime in July. That 2Q20 revenue report is going to be brutal.
Unlike other industries, which are only 30% restaffed, Penn has called up 80% of its workforce, “opting to understaff vs. overstaff to avoid having to 
re-furlough employees.” Slot floors will operate at half strength, in terms of machines, and table-game seating has been similarly reduced. Since 80% of Penn’s revenue comes from just 23% of its customers, it has reduced marketing to unprofitable players by at least one-third. If you’re a middle-class or working-class player, expect fewer promos offers, by the way. And you’ll be getting less direct mail, which you may actually welcome. Penn seems optimistic about eking out a profitable year, estimating break-even at 65%-70% of 2019 revenues.
The political scene is heating up for Penn, with sports betting on the Louisiana and Maryland election ballots, and is “gaining momentum” in Ohio and Missouri. Legislators may also be induced by budget woes to take a second look at i-gaming. Finally, assuming an NFL season (much 
as Tom Brady is doing), Penn plans a September rollout of its Barstool Sports-branded sports-betting application, Penn Interactive having been untouched by layoffs. (A strategic allotment of resources, to be sure.) “With zero sports in the U.S. today, management actually sees a more level playing field as customers have drawn down their account balances,” Greff wrote, adding, “Barstool’s demographic skews much younger than PENN, so there is little risk of cannibalization.”
Jottings: The Cosmopolitan of Las Vegas is joining the free-parking bandwagon. MGM Resorts International, however, might still dun you for valet parking … Venelazzo has finally begun taking room 
reservations, effective June 1. Las Vegas Sands has been the last of the Big Four to reenter the market. The Venetian only will reopen, followed by Palazzo at an unspecified date … Clique Hospitality founder Andy Masi ponders how to reopen his many Las Vegas restaurants and finds himself with more questions than answers. He adds, “I don’t think it’s going to be about making tons of profit anytime soon … it’s going to be about getting people back to work.” … Adriano Marques Ho is Macao‘s new top gaming regulator. His predecessor went back to the prosecutor’s office, in what appears to be a smooth transfer.
