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Investing.com - Citizens JMP analyst Jordan Bender has reiterated a Market Outperform rating and $55.00 price target on Red Rock Resorts (NASDAQ:RRR) stock, which currently trades at $54.72. The stock has shown impressive momentum, gaining over 26% in the past six months. InvestingPro analysis reveals 12 additional investment insights for this casino operator, including key valuation metrics and growth indicators.
The analyst noted that a recent bill allows up to the first $25,000 of voluntary tips to be deducted from taxes, though tipped employees must still pay taxes on tips as they occur.
According to Bender, this tax structure means people will receive larger tax returns during tax season, which could lead to increased revenue for Red Rock Resorts in the first and second quarters.
During a recent trip to Las Vegas, the analyst observed that gaming operators were uncertain about the financial impact of this tax change on their businesses, but Citizens JMP views it as a positive catalyst for Red Rock Resorts.
The tax exemption on tips is set to expire in 2028, creating a limited timeframe for this potential revenue boost.
In other recent news, Red Rock Resorts reported its Q1 2025 earnings, exceeding expectations with an earnings per share (EPS) of $0.75, compared to the forecasted $0.48. The company’s consolidated net revenue was $497.9 million, slightly below the expected $499.25 million. Despite the revenue miss, the company continues to focus on expanding its casino space and renovating existing properties. In terms of mergers and acquisitions, Red Rock Resorts announced a $750 million tribal casino development project, which is expected to be completed by mid-2026.
Additionally, shareholders re-elected all nominated board members during the company’s recent Annual Meeting of Stockholders, indicating strong support for the current leadership. In the realm of stock ratings, JPMorgan initiated coverage on Red Rock Resorts with an overweight rating, citing the company’s attractive growth pipeline and potential benefits from legislative changes. Mizuho (NYSE:MFG) analysts also upgraded the company’s stock rating to outperform, setting a new price target of $50.00. These developments highlight the confidence analysts have in Red Rock Resorts’ future performance and strategic direction.
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