“Boyd is a highly leveraged casino play that has no exposure to high growth Asian markets.” With those words, Seeking Alpha concludes a severe assessment of Boyd Gaming, an investment upon which it frowns, 
despite being at a five-year high. Wall Street is not fond of Boyd and Seeking Alpha‘s analysis makes it clear why. It cites 1) “its high level of indebtedness,” which leaves it vulnerable to economic adversity; 2) a 13:1 debt-to-equity ratio*; 3) “interest payments [that] have more than consumed operating income”; 4) a 2018 “maturity wall” on its debt; 5) a “simply ugly” balance sheet, “forcing it to operate solely to pay back creditors”; 6) forward trading that is too far out of alignment with the company’s rate of growth (58% vs. 2%); 7) “Online gaming continues to be an area of high potential that has been slow to materialize.”
New Jersey sports betting is, best-case scenario, two years away. And Boyd’s devaluation of Borgata to $880 million is described as “comical” and a ruling that could tip Atlantic City into insolvency, “which would probably further erode casino business, including the Borgota’s. While Borgota has outperformed thanks to its brand, customers don’t want to vacation at a ghost town, so if other casinos continue to atrophy, it is likely to continue to struggle.” Seeking Alpha puts a “sell” recommendation on Boyd — kind of scary when you consider how rarely you see that in the gaming sector.
* — 3.25:1 is the industry average
Walt Disney Co. frowns upon casinos in Florida partly for the obvious 
reason: diminution of the Sunshine State’s kid-friendly image. However, there’s a hidden agenda. Characters owned by Marvel Comics and by Lucasfilm, subsidiaries of The Mouse, are being forced to let their slot-theme licensing deals expire, cutting off revenue streams. If these seems like a classic case of amputating one’s nose to to spite your own face, you’d be right. However, the imminent prospect of renewed casino debate in Florida has Disney wanting to borrow Thor‘s hammer and smash things up a bit. Meanwhile, it continues to book revenue from those grandfathered sublicensing deals. Disney’s principles won’t prevent it from stooping to scoop up some slot-derived monies.
If New Yorkers vote for casino expansion on Nov. 5, what will it mean economically? If we go by the case of Salamanca, the net change will not be significant … at least outside casino walls.
