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On Monday, JMP Securities adjusted its stance on Full House Resorts (NASDAQ:FLL), maintaining the price target at $6.00 but upgrading the stock from Market Perform to Market Outperform. According to InvestingPro data, the company currently operates with a significant debt burden and faces cash flow challenges, with an EBITDA of $37.1 million in the last twelve months. The research firm's analyst cited recent observations from ICE Barcelona and additional state data that suggest the company may face challenges this quarter. The analyst pointed out that Full House Resorts is likely to experience headwinds due to the lower-end consumer market and seasonal snow levels in Colorado, which could negatively affect the company's EBITDA results.
The analyst has revised the EBITDA estimates downward for Full House Resorts, setting them at what is considered a Street low. This reflects a more cautious outlook on the company's performance during Colorado's winter season, which is typically slower. Despite this, JMP Securities believes that the stock is trading at an attractive multiple of 7.1 times its 2026 consensus EBITDA. Currently, the company trades at an EV/EBITDA multiple of 18.1x, with InvestingPro analysis suggesting the stock is slightly overvalued at current levels.
Full House Resorts' growth potential in the coming years was highlighted as a reason for the positive rating. The company has already demonstrated strong revenue growth of 28.57% in the last twelve months, with a market capitalization of $169.82 million. The company is projected to achieve a significant compound annual growth rate (CAGR) of 33% in EBITDA from 2024 to 2026. This anticipated growth is a key factor in the analyst's assessment, despite the near-term challenges that may affect quarterly results. Get access to 8 additional key insights about Full House Resorts and comprehensive analysis with an InvestingPro subscription.
Investors are being presented with a picture of a company that, while potentially facing a tough quarter, has promising growth prospects in the medium term. The stock's current valuation, in light of these prospects, is viewed as an opportunity by JMP Securities. The company's next earnings report is scheduled for March 11, 2025, which will provide crucial insights into its performance and growth trajectory.
The analyst's comments underline the importance of considering both short-term headwinds and long-term growth trajectories when evaluating investment opportunities. Full House Resorts' stock rating upgrade reflects a balance of these considerations, with an emphasis on the company's future potential.
In other recent news, Full House Resorts, Inc. has announced several significant developments. The company has appointed Jeff Michie as the new vice president and general manager of its Rising Star Casino (EPA:CASP) Resort in Rising Sun, Indiana, pending customary gaming approvals. Michie, who brings a wealth of experience from the casino industry, will replace Angi Truebner-Webb, who is now set to manage the Silver Slipper Casino Hotel in Mississippi.
Additionally, Full House Resorts has unveiled its third quarter financial results, led by Chief Financial Officer Lewis (JO:LEWJ) Fanger. The company has also announced an upcoming advertising campaign for the Chamonix project. As part of these recent developments, inducement equity awards were granted to Michie and two other new employees, Kimberly Bender and Katelynn May, in a bid to attract top talent.
Investors were directed to the company's website for additional information, presentations, and video links for the Chamonix ads. A question-and-answer session followed the formal presentation, reflecting Full House Resorts' commitment to transparency and communication with its investors. These recent developments underscore the company's active engagement with stakeholders and its enthusiasm for the upcoming Chamonix project.
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