2024-07-16 09:15:49 ET
Summary
- Boyd operates casinos in various states with better-growing online operations on top after a 2022 acquisition.
- The company's long-term brick-and-mortar growth has been stable, but with slower traffic, the increasing market share of online casinos, and macroeconomic weakness, the outlook seems to be weaker going forward.
- Higher house edges that have pushed Boyd's margins up from 2021 forward have caused occupancy to stay at a lower level, also affecting traffic very negatively and pressuring margins back.
- The stock's valuation seems to price in a fair earnings level going forward, although better traffic could still make the valuation cheap at the current price.
Boyd Gaming Corporation ( BYD ) operates casinos in several states, including Aliante, California Hotel Casino, Cannery, and Fremont among others in Las Vegas, Nevada, and other casinos in locations such as Missouri, Indiana, Iowa, Louisiana and others. The company currently operates a total of 28 casinos , of which the Las Vegas -located Cannery casino remains closed due to market conditions. The company also has a 5% strategic ownership in FanDuel, a sportsbook brand with a good online presence, which Boyd also partners with in its casino properties....
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Boyd Gaming: Higher Margins Came At The Expense Of Traffic