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4 Solid Casino Stocks to Buy on a Thriving Gambling Industry

Experts feel that the casino industry is recovering at a faster rate than expected and is on track to surpass $44 billion in revenues this year. This...

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This story originally appeared on Zacks

The gambling industry was badly hit last year as the pandemic prevented people from visiting casinos. However, things started changing as the economy started to reopen and the vaccination drive gathered steam.

- Zacks

Having been deprived of gambling for months last year, people this year are splurging at casinos. This has been helping the gambling industry tonot only recover the past losses but also set a new record in terms of revenues this year.

Gambling Revenues Hit New High

According to data from the American Gaming Association, revenues from gambling hit a record high of $13.6 billion in the second quarter of 2021. Revenues from states where gambling is legal are up 22% from the earlier record of $11.1 billion set in the third quarter of 2019, when the pandemic had not hit.

Gambling was already flourishing in the United States till the pandemic hit early last year. Prior to that, in 2019, revenues from gambling hit a record high of $43.6 billion. Now, it seems gamblers are back with renewed vigor and shelling out billions, thus helping the industry to recover faster than expected.

On a year-to-date basis, gambling revenues have totaled around $25 billion. According to the report, 22 of the 25 states where gambling is allowed, saw revenues growing in the second quarter from the same period a year ago.

The maximum gains were recorded in Nevada, with $3.46 billion in gambling revenues in second-quarter 2021. This is 17% higher than the same period in 2019. Pennsylvania brought in $1.21 billion, while New Jersey recorded $1.11 billion in the second quarter of 2021.

Gambling Industry Poised to Grow

The economic reopening has given a fresh lease of life to casinos that were left almost vacant last year. Nevada particularly has been putting up a great show, after beating all revenue records in the past four months. The state raked in $3.46 billion in casino revenues in the second quarter, marking the best quarterly gaming revenue collection in its history.

As the economy further reopens and more people get vaccinated, the casinos will again be on a roll. Experts feel that the casino industry is recovering at a faster rate than expected and is on track to surpass $44 billion in revenues this year.

Our Choices

It would be ideal to invest in these four stocks that are poised to benefit from the gambling industry’s recovery. Each of the stocks sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Boyd Gaming Corporation BYD owns and operates gaming entertainment properties in Nevada, Illinois, Indiana, Iowa, Kansas, Louisiana, Mississippi, Missouri, Ohio and Pennsylvania. As of Dec 31, 2020, the company owns and operates 28 properties, offering 1.76 million square feet of casino space, 35,023 slot machines, 804 table games and 11,087 hotel rooms.

The company’s expected earnings growth rate for the current year is more than 100%. The Zacks Consensus Estimate for current-year earnings improved 44% over the past 60 days. 

Century Casinos, Inc. CNTY and its subsidiaries own & operate a limited-stakes gaming casino in Cripple Creek, Colorado and are pursuing a number of additional gaming opportunities internationally and in the United States.

The company’s expected earnings growth rate for the current year is more than 100%. The Zacks Consensus Estimate for current-year earnings improved 87.5% over the past 60 days. 

Golden Entertainment, Inc. GDEN is a diverse gaming company that offers casino, distributed gaming and lottery services. The company's gaming divisions consists of Golden Casino Group, PT's Entertainment Group and Golden Route Operations. 

The company’s expected earnings growth rate for the current year is more than 100%. The Zacks Consensus Estimate for current-year earnings improved more than 100% over the past 60 days. 

Red Rock Resorts, Inc. RRR not only manages but also owns an equity interest in Station Casinos (Station LLC). Station Casinos provides gaming and entertainment to the residents of Las Vegas. Station LLC owns as well as operates 10 major gaming and entertainment facilities, and 10 smaller casinos. As of Jun 30, 2021, the company held nearly 61% of the economic interests in Station Holdco.

The company’s expected earnings growth rate for the current year is more than 100%. The Zacks Consensus Estimate for current-year earnings improved more than 100% over the past 60 days.



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Boyd Gaming Corporation (BYD): Free Stock Analysis Report

 

Century Casinos, Inc. (CNTY): Free Stock Analysis Report

 

Red Rock Resorts, Inc. (RRR): Free Stock Analysis Report

 

Golden Entertainment, Inc. (GDEN): Free Stock Analysis Report

 

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