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On Thursday, Citizens JMP maintained a positive stance on Golden Entertainment (NASDAQ:GDEN) shares, reiterating a Market Outperform rating with a steady price target of $36.00. Currently trading at $25.52, the stock sits well below analysts’ consensus target range of $31-$40. The firm’s analysts highlighted the company’s promising prospects in anticipation of a forthcoming event that could enhance shareholder value. According to InvestingPro analysis, the stock appears undervalued based on its Fair Value assessment.
Golden Entertainment, which trades on the NASDAQ under the ticker GDEN, has caught the attention of Citizens JMP due to its potential for a significant value-creation event. With a market capitalization of $677 million and a solid gross profit margin of 54%, the company maintains a "FAIR" overall financial health score. The analysts at Citizens JMP have expressed confidence in the company’s ability to perform well, which is reflected in their sustained Market Outperform rating. Discover more detailed insights with InvestingPro, which offers 8 additional key tips about GDEN’s performance and prospects.
The price target set by Citizens JMP suggests that the firm believes Golden Entertainment’s stock has the capability to reach $36.00. This target remains unchanged, indicating the analysts’ ongoing belief in the company’s strong fundamentals and future prospects. Notable among these fundamentals is management’s aggressive share buyback program, though InvestingPro data indicates net income is expected to decrease this year.
The specific details of the anticipated value-creation event were not disclosed, but such events typically include strategic business decisions like mergers, acquisitions, spin-offs, or other corporate restructuring that could potentially increase a company’s value and, consequently, its stock price.
Golden Entertainment operates in the gaming and hospitality industry, owning casinos, taverns, and gaming operations across different regions. With an EBITDA of $135 million and a current ratio of 1.03, the company maintains stable operations despite recent stock volatility. The company’s performance and the subsequent analyst rating are of interest to investors who follow the stock and the broader market in which it operates.
In other recent news, Golden Entertainment reported its fourth-quarter 2024 earnings, revealing a shortfall in earnings per share (EPS) compared to analyst forecasts. The company’s EPS was $0.10, missing the expected $0.22, while revenue for the quarter was $164.2 million, falling short of the anticipated $168.83 million. Despite these results, the company remains focused on future growth, with strategic initiatives including development opportunities in Las Vegas and improving tavern performance. Golden Entertainment also repurchased 2.9 million shares, returning $190 million to shareholders, and divested its Nevada distributed business for over $600 million, which has strengthened its balance sheet. Analysts at Citizens JMP have raised the stock target to $37, maintaining a Market Outperform rating, following Golden Entertainment’s fourth-quarter performance, where EBITDA exceeded consensus estimates. The company’s Locals segment saw an 8% increase compared to expectations, while the Taverns segment underperformed due to increased costs. Looking ahead, Golden Entertainment anticipates organic growth in 2025, focusing on cost control and exploring potential mergers and acquisitions.
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