These 5 Casino Stocks are Cashing Out

Earlier this week, Nevada’s State Gaming Control Board reported that casinos in the state won $864 million from gamblers in September, which represents a 6.6% decline from last year.  Furthermore, gambling revenue on the Las Vegas Strip fell 5.7% to $490.9 million.  In light of the report, these 5 casino stocks are cashing out.

Shares of Melco Crown Entertainment (NASDAQ:MPEL) led the decline in casino stocks on Thursday, as shares closed more than 12% lower.  The company also reported third quarter earnings before the closing bell.  Net income for the resort and casino company rose to $113.3 million (21 cents per share), compared to $15.8 million (3 cents per share) last year.  Forbes explains,  “The problem with Melco’s earnings, which is actually a problem that affects Macau in general, is inflated expectations.  Growth at Macau has been so strong, with October revenues growing about 40% year-over-year, that markets may begin to take it for granted, according to Nomura’s equity analysts.  Morningstar’s Chad Mollman believes Melco’s beat was based on an abnormally high win rate at its major casinos, rather than underlying fundamentals, suggesting that in an adjusted basis, Melco actually missed expectations.”

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Shares of Las Vegas Sands (NYSE:LVS) and Wynn Resorts (NASDAQ:WYNN) both closed about 3.5% lower on Thursday.  LVS owns and operates properties such as The Venetian and The Palazzo.  LVS recently reported higher profit for the third quarter as revenue showed growth.  Net income rose 98.1% to $424.9 million (44 cents per share), compared to $214.5 million (21 cents per share) last year.  Shares are down 3% year-to-date.  In comparison, shares of Wynn have increased 15% this year.  Last week, the company attracted heavy attention after declaring a $5 special dividend.  The $5 dividend will be paid December 21 to shareholders of record as of November 23. The company operates casinos in Las Vegas and Macau, China. The company also issued an $8 special dividend last year.

Boyd Gaming Corporation (NYSE:BYD) owns and operates several gaming properties throughout the United States. The Company also operates entertainment, restaurants, shopping, and recreational facilities on its properties.  Shares closed nearly 3% lower on Thursday, and are down 41% year-to-date.  The company recently posted lower net income in the third quarter compared with a year-earlier period.  Net income for the resort and casino company fell to $3.1 million (4 cents per share), compared to $5.6 million (6 cents per share) last year. This is a decline of 44.4% from the year earlier quarter.

MGM Resorts International (NYSE:MGM) held up rather well during Thursday’s sell off.  Shares declined less than 1%, but are still down 33% year-to-date.  MGM recently announced that its third quarter loss narrowed due mainly to positive revenue growth.  Loss narrowed to $123.8 million (25 cents per share), compared to a loss of $318 million (72 cents per share) in the same quarter last year.  The company has now topped analyst estimates for the last four quarters. It beat the mark by 5 cents in the second quarter, by 3 cents in the first quarter, and by 2 cents in the fourth quarter of the last fiscal year.

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