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On Wednesday, Stifel analysts reaffirmed their Buy rating and maintained a $4.00 price target for Century Casinos (NASDAQ: NASDAQ:CNTY) stock, representing a potential 100% upside from the current price of $1.99. According to InvestingPro data, the stock has declined over 52% in the past six months, though it’s showing recent momentum with strong returns over the last month. This decision follows a series of one-on-one investor meetings with Century Casinos’ Co-CEO, Peter Hoetzinger, at the firm’s annual Cross Sector Insight Conference.
Key insights from the meetings highlight several aspects of Century Casinos’ operations. While the company has experienced sustained growth in Gross Gaming Revenue (GGR) in the second quarter to date, InvestingPro analysis reveals concerning financial health metrics, with a weak overall financial health score and significant debt burden of over $1 billion. The company has maintained a gross profit margin of 42.6%, though it’s currently unprofitable. Additionally, the Caruthersville project is progressing well as the company focuses on optimization and customer engagement.
However, the underperformance of the Nugget property remains a concern. The company anticipates improvement in group and convention bookings in the second half of 2025 and into the calendar year 2026. Meanwhile, the divestiture of its Poland operations is reportedly gaining momentum.
Stifel analysts view Century Casinos as a high-risk, high-reward turnaround opportunity. They believe that achieving the $4 per share target is possible with successful returns from the Missouri project and operational enhancements at the Nugget, although further gains may require more extensive balance sheet improvements. Despite macroeconomic risks, the analysts see potential for acquisition options supporting the stock at its current levels.
In other recent news, Century Casinos has announced a $3 million stock repurchase plan, aiming to buy back shares by July 2025. This move is part of a broader strategy to manage capital allocation and enhance shareholder value. Additionally, the company reported its first-quarter 2025 earnings, showing a revenue of $130.4 million, which fell short of the $141.59 million forecast. The earnings per share also missed expectations, coming in at -0.67 compared to the anticipated -0.45. Adverse weather conditions and the absence of a leap day were cited as factors affecting performance.
Analysts at Citizens JMP and Macquarie have adjusted their price targets for Century Casinos. Citizens JMP lowered the target to $3, maintaining a Market Outperform rating, while Macquarie reduced it to $4, also maintaining an Outperform rating. The company has seen mixed results across different properties, with the Caruthersville location showing a positive margin profile. Despite challenges, Century Casinos is focusing on cost-cutting measures expected to save $1 million annually and remains optimistic about its long-term prospects.
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