Posted on: May perhaps 1, 2021, 12:54h.
Very last up to date on: Could 1, 2021, 04:37h.
Immediately after soaring additional than 23 per cent this week, Century Casinos (NASDAQ:CNTY) is up 106 % yr-to-day. That easily will make it just one of the very best-undertaking gaming equities.
People just now exploring the regional on line casino operator can consider heart, since analysts see extra upside coming for the shares. In fact, it was analyst commentary that sparked some of the stock’s surge this 7 days, as B. Riley’s David Bain initiated coverage of the gaming fairness with a “buy” rating and an $18 rate focus on. That indicates appreciation likely of about 38 p.c from the April 30 shut.
CNTY’s properties are locals-primarily based, which we consider are benefiting from multiple motorists in the current surroundings, like the vaccine travel and fiscal stimulus,” said Bain in a observe to clients.
All those things, coupled with the stock’s ascent, affirm analysts and traders are prizing Century for its US exposure, mainly because the shares are soaring even as the operator contends with non permanent closures of venues in Canada and Poland.
In the US, Century’s roster is made up of a pair of casinos in its property point out of Colorado, as well as Missouri and West Virginia.
Century Inventory Could Be Moved by Acquisitions
Even though Century’s portfolio of domestic houses is modest compared to some rivals in the regional casino place, the operator is beloved by some analysts because management has a name for properly integrating bolt-on acquisitions.
At the conclude of final year, the firm experienced $63.4 million in money on hand, and with Century stock soaring, it has forex to go purchasing. In addition, there’s the widely predicted sale of its Poland property, which must deliver in excess cash for offer-earning. B. Riley’s Bain says the gaming enterprise could imminently return to its acquisitive ways, and that could potentially bring about extra than doubling of the share value.
“CNTY represents a scarce casino operator worth participate in that could likely double earnings just before desire, taxes, depreciation, amortization, and restructuring or hire charges (EBITDAR) by domestic acquisitions by CY23E, producing for each-share price of in excess of $28, in our perspective,” claimed the analyst. “We believe CNTY’s upcoming US casino acquisition will be introduced right before the finish of 3Q21, developing an estimated for every-share price of $4, not mirrored in our value target.”
Bain says Century is probably reviewing “multiple US regional on line casino acquisition opportunities,” but he didn’t get into details.
Much more Catalysts for Century Inventory
Yet another imminent catalyst for Century is implementation of better betting boundaries and introduction of new table games in Colorado. That came about by way of passage of Modification 77 very last November, and analysts and operators believe the elimination of the $100 guess cap will aid casinos in the point out seize a for a longer period-remaining, larger-close clientele.
Yet another advantage for Century is that its domestic venues are intensely frequented by locals — demographics that are wanting to invest stimulus hard cash and get out of the household right after receiving coronavirus vaccinations.
“We consider locals casinos are at this time benefiting from pent-up demand from customers, increased potential allowances, the COVID vaccine rollout (driving a key more mature demographic back to the on line casino), near-to-home enjoyment, fiscal stimulus, and structural margin augmentation,” reported Bain.