3 Gaming Stocks Poised To Beat Coronavirus Woes
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The Zacks Gaming industry continues to bear the brunt of low visitation, and dismal Macau and Las Vegas gaming revenues. The industry participants are not only witnessing soft revenues but also decline in margin.
However, the reopening of the economy has been reinstating investor confidence. Meanwhile, the much-awaited coronavirus vaccine, the rollout of which has begun, is likely to bring the economy back on track. The industry players have been benefiting from robust demand for sports betting. Companies like Red Rock Resorts, Inc. (RRR - Free Report), Monarch Casino & Resort, Inc. (MCRI - Free Report), and Golden Entertainment, Inc. (GDEN - Free Report) are likely to benefit from the aforementioned factors.
Industry Description
The Zacks Gaming industry comprises companies that primarily own and operate integrated casino, hotel, and entertainment resorts. Some of the industry participants also offer technology products and services across lotteries, electronic gaming machines, sports betting, and interactive gaming.
3 Trends Shaping the Future of Gaming Industry
Dismal Visitation Hurts Performance: Gambling hubs — Macau and Las Vegas — has been witnessing dismal visitation due to the coronavirus pandemic. Although most of the casinos in Macau and Las Vegas have resumed operations following the coronavirus-induced shutdown, casino tables are still empty. This has resulted in a sharp decline in Macau gross gaming revenues (GGR) in November. Notably, gross gaming revenues from Macau fell to 6.75 billion patacas ($845.34 million) in November, down 70.5% from the year-ago period. The coronavirus pandemic has been impacting the gaming industry severely as most of the casinos are witnessing lower traffic on account of the outbreak. It is worth mentioning that the same was down 72.5%, 90%, 94.5%, 94.5%, 97%, 93.2%, 96.8%, 79.7%, and 87.8% in October, September, August, July, June, May, April, March, and February, respectively. In fact, revenues have declined in every month so far this year. Decline in gambling revenues from Macau is likely to impact companies, including MGM Resorts International (MGM - Free Report), Wynn Resorts, Limited (WYNN - Free Report), and Las Vegas Sands Corp. (LVS - Free Report), which generate majority of their revenues from Macau.
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