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Tuesday, Full House Resorts (NASDAQ:FLL) received a new Buy rating from Texas Capital Securities, accompanied by a price target set at $7.00, representing a 128% premium to the current stock price of $3.07. The research firm’s analysts foresee a significant increase in the company’s EBITDA by the year 2029, projecting it to be approximately 210% higher than the actual EBITDA of $42.9 million reported for 2024. InvestingPro data shows the stock currently trades near its 52-week low of $2.86, with analysts maintaining a consensus Buy recommendation.
The optimism from Texas Capital Securities stems from the anticipated second half of 2027 opening of Full House Resorts’ permanent American Place (AP) and continuous improvements at Chamonix. Analysts at the firm believe these developments will lead to a substantial rise in the company’s per-share valuation over the coming years. According to InvestingPro, the company operates with a significant debt burden and has been quickly burning through cash - two of 12+ key insights available to subscribers.
In the near term, Full House Resorts is expected to outperform regional peers in terms of EBITDA growth for 2025 and 2026. The analysts highlighted that recent market volatility has disproportionately affected the company’s stock price, which has declined 39% over the past six months, due to misunderstandings regarding the timeline and funding needs for the American Place project. With a market capitalization of $111.5 million and a debt-to-capital ratio of 0.82, this has reportedly created a favorable buying opportunity for investors.
Texas Capital Securities’ calculations suggest that Full House Resorts could achieve an EBITDA of around $151 million by 2029, a stark increase from the approximately $49 million expected for 2024. Applying current valuation multiples of its peers to the 2029 EBITDA forecast and subtracting anticipated net debt, analysts estimate the stock could be worth in excess of $17 per share.
While acknowledging the risks associated with the long-term development of the permanent AP and execution challenges, Texas Capital Securities underscored the visible strong return on investment and the management team’s proven track record in successful development projects.
In other recent news, Full House Resorts Inc . reported a challenging fourth quarter for 2024, with earnings per share (EPS) of -$0.35, missing analysts’ forecasts of -$0.23. Revenue also fell short, coming in at $72.96 million compared to the projected $75.78 million. In a strategic move, the company has switched its auditor to Ernst & Young LLP for the fiscal year ending December 31, 2025. This change comes as Full House Resorts continues to emphasize the integrity of its financial reporting.
Meanwhile, Macquarie analyst Chad Beynon maintained a Neutral rating on the company’s stock, noting that while property EBITDA fell short of expectations, overall company EBITDA increased by 42% year-over-year. Citizens JMP analyst Jordan Bender lowered the stock price target to $5.00 from $6.00, citing a cautious outlook on near-term performance. Additionally, Full House Resorts extended its CFO Elaine Guidroz’s contract until August 2025, signaling stability in its financial leadership.
The company is also preparing for significant growth, with plans to commence permanent construction on the American Place project in 2025, estimated to cost around $300 million. Despite higher costs affecting the Chamonix property, management remains optimistic about revenue growth and operational efficiency in the coming years.
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