Golden Leisure Inventory Heralded As Nevada Pure Play


Posted on: March 18, 2024, 11:46h. 

Final up to date on: March 18, 2024, 11:52h.

Shares of Golden Leisure (NASDAQ: GDEN) are off 15.15% year-to-date and the inventory labors 25% under its 52-week excessive, however some analysts stay bullish on the title.

Golden Entertainment
Golden Leisure’s Strat Las Vegas. An analyst is bullish on the inventory, lauding its Nevada publicity and robust stability sheet. (Picture: OnTheStrip.com)

That group consists of Truist Securities analyst Barry Jonas, who in a latest report back to purchasers, initiated protection of the Strat operator with a “purchase” ranking and a $45 value goal. That suggests upside of about 32% from the March 15 shut. Jonas believes Golden is underappreciated and undervalued.

(Present valuation) doesn’t replicate enhancing fundamentals, a big discount in leverage, or an actual property possession backstop,” he wrote.

In anointing Golden Leisure the “Silver State Warriors,” Jonas added that the on line casino operator has top-of-the-line stability sheets within the trade and that returning capital to shareholders could possibly be an growing precedence for the gaming firm.

Golden Leisure Now a Nevada Pure Play

Following its $260 million sale of the Rocky Hole On line casino Resort in Flintstone, Md., and the divesture of its slot route unit final yr, Golden is now a pure play on Nevada with almost 70 PT’s Pubs and casinos in Las Vegas, Laughlin, and Pahrump.

Along with the Strat, Golden’s different Sin Metropolis casinos are Arizona Charlie’s Boulder, and Arizona Charlie’s Decatur. Coupled with PT’s Pubs, that’s sufficient to tether Golden to the rising prominence of the Las Vegas locals demographic, which is boosted largely by the Valley’s hovering inhabitants.

In Pahrump, which is situated about 58 miles from the Las Vegas Strip, Golden owns and operates the Gold City On line casino, Lakeside Resort & On line casino, and Pahrump Nugget Resort & On line casino. Golden operates the Aquarius and Edgewater gaming venues in Laughlin. That places it in competitors with Caesars Leisure (NASDAQ: CZR) because the dominant on line casino title in that metropolis.

Golden is also mulling choices for the Colorado Belle in that metropolis, which has been shuttered since 2020 as a result of coronavirus pandemic.

Golden Leisure’s Actual Property Story Not Totally Appreciated

Truist’s Jonas argued that buyers ascribe some credit score for Golden’s Las Vegas actual property holdings, including that the inventory’s present multiples suggest a shareholder is getting the corporate’s Sin Metropolis on line casino operations at no cost. Nonetheless, there isn’t a lot adulation for everything of the operator’s property holdings.

“Moreover, we expect GDEN’s actual property could possibly be value as a lot because the entirety of its present fairness worth, with the OpCo primarily free,” noticed Jonas.

Wall Road has lengthy praised gaming corporations with intensive or full management of their actual property, and it’s not a stretch to imagine Golden’s Nevada actual property is value near or greater than its market capitalization of $977.05 million.

Jonas additionally sees Golden as a capital return story, a thesis that was cemented earlier this month when the corporate initiated a quarterly dividend. The Arizona Charlie’s operator has additionally been a faithful purchaser of its personal shares and is actively decreasing debt.

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