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In a challenging year for the hospitality and gaming industry, Red Rock Resorts Inc . (NASDAQ:RRR) stock has tumbled to $41.77, near its 52-week low of $42.33, a stark contrast to its 52-week high of $63.28. According to InvestingPro analysis, the stock is currently trading at Fair Value. The Las Vegas-based company, which operates a portfolio of casino and entertainment properties, has seen a significant downturn in its stock value, reflecting a broader trend in the sector. Despite maintaining impressive gross profit margins of 67% and a decade-long track record of consistent dividend payments, the stock has declined 26.5% over the past year. Investors are closely monitoring the company’s recovery strategies and potential market shifts that may influence its trajectory, with analyst price targets ranging from $45 to $63. InvestingPro subscribers can access 10 additional key insights and a comprehensive Pro Research Report for deeper analysis of RRR’s financial health and growth prospects.
In other recent news, Red Rock Resorts reported a strong financial performance for the fourth quarter of 2024, with earnings per share (EPS) of $0.76, significantly surpassing the forecasted $0.43. The company also posted net revenue of $495.7 million, exceeding expectations of $491.73 million. Analysts have responded positively to these results, with Jefferies, Mizuho (NYSE:MFG), Truist Securities, and JMP Securities all raising their price targets for Red Rock Resorts. Jefferies and Mizuho both set a price target of $52, while Truist Securities increased their target to $56, and JMP Securities set theirs at $59.
The firm’s robust EBITDA performance, which outpaced consensus estimates, was highlighted by Mizuho and Truist Securities, despite challenges such as a $6 million negative impact from lower sports betting hold in December. JMP Securities noted the company’s strategic positioning to generate significant discretionary free cash flow by 2026, projected at $520 million. However, ongoing renovations and expansions, including at the Durango property, are expected to impact earnings by $25 million throughout 2025, according to Truist Securities.
Jefferies and JMP Securities both maintained a Hold rating, while JMP Securities remained more optimistic with a Market Outperform rating. These developments reflect a cautiously optimistic outlook for Red Rock Resorts, with analysts noting the company’s strong long-term growth potential balanced by near-term challenges.
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