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Wednesday - Susquehanna has shifted its stance on Boyd Gaming (NYSE:BYD), upgrading the stock from Neutral to Positive. The research firm also adjusted its price target to $77, down from the previous $79. This change comes after a reassessment of the company’s valuation, taking into account several factors that impact Boyd Gaming’s business. The casino operator, currently trading at a P/E ratio of 10.87x with an EBITDA of $1.22 billion, has shown impressive gross profit margins of 61.86%.According to InvestingPro analysis, Boyd Gaming appears undervalued at current levels, with multiple indicators suggesting potential upside. Subscribers can access detailed valuation metrics and 12 additional ProTips for deeper insights.
Susquehanna’s analysts have cited that the new rating reflects an attractive discount for Boyd Gaming’s shares, considering the revised regional estimates for the first and second quarters. The downgrade in the price target and estimates is a response to worse than expected February weather conditions and flat March assumptions, which are believed to affect the company’s performance. Recent market data shows the stock has experienced an 8.85% decline over the past week, with the RSI indicating oversold conditions.
The firm also applied a lower multiple to their Las Vegas Locals assumptions for Boyd Gaming, moving from 9.0x EBITDAR to 8.0x in their Sum of the Parts (SOTP) valuation. This adjustment is part of a broader reassessment in light of concerns over a potential recession, which could influence consumer spending and, by extension, Boyd Gaming’s revenue.
Despite the lowered price target, Susquehanna’s analysts have expressed confidence in Boyd Gaming’s long-term prospects. They have described the stock as an actionable long investment after the recent revisions, suggesting that the current share price offers an entry point for investors.
Boyd Gaming’s stock is expected to navigate through the near-term challenges, with Susquehanna’s revised estimates covering the period from 2025 to 2027. The firm’s analysts believe that even with the tempered expectations, Boyd Gaming’s current market position and potential for growth justify the Positive rating.
In other recent news, Boyd Gaming Corporation announced an increase in its quarterly dividend to $0.18 per share, up from the previous $0.17. This dividend will be distributed on April 15, 2025, to shareholders on record as of March 17, 2025. In analyst updates, Barclays (LON:BARC) reiterated its Underweight rating on Boyd Gaming, maintaining a price target of $7.00, while highlighting the company’s strong year-over-year growth in international sales. Meanwhile, Morgan Stanley (NYSE:MS) downgraded Boyd Gaming’s stock from Overweight to Equalweight, citing a more balanced risk-reward scenario and adjusting the price target to $81 from $82. Stifel raised its price target for Boyd Gaming to $82, maintaining a Hold rating, and noted the company’s solid performance in the Las Vegas Locals market and potential growth from a project in Norfolk, Virginia. Additionally, Boyd Gaming reported a significant 161% year-over-year increase in deliveries, with more than 65,000 vehicles delivered in overseas markets for the second consecutive month. Barclays also noted the company’s plans to expand production capabilities with new facilities in Indonesia and Hungary by the end of 2025, and a Turkish plant by the end of 2026. These developments reflect Boyd Gaming’s strategic initiatives and robust financial health, providing a foundation for its future growth.
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