On Friday, Boyd Gaming Corporation (NYSE:BYD (SZ:002594)) received a higher stock price target from Mizuho, now set at $79, up from the previous $78, while the Outperform rating was reaffirmed. The adjustment followed the company's earnings report, which surpassed analyst expectations.
Boyd Gaming posted an adjusted EBITDA of $358 million, outperforming both Mizuho's projection of $346 million and the consensus estimate of $339 million. The performance was broken down by segment, with the Locals EBITDA at $96.4 million compared to the forecasted $95.7 million and the Street's $97.0 million.
Downtown EBITDA reached $16.5 million, slightly below Mizuho's estimate of $17.4 million but above the Street's $16.3 million. The Midwest & South segment reported a robust $197 million, aligning with Mizuho's estimate and exceeding the Street's expectation of $190 million.
The company's Treasure Chest property continued to exceed performance forecasts, and Boyd Gaming saw marginal improvements in margins within both the Locals and Midwest segments.
The analyst noted Boyd Gaming's gradual shift towards a narrative of potential growth driven by high-return investments, such as Par-a-Dice, the Norfolk project, the Sky River expansion, and other discretionary ROI projects estimated at $100 million annually.
The modest increase in the stock price target to $79 from $78 by Mizuho reflects confidence in Boyd Gaming's continued financial growth and strategic investments that are expected to yield attractive returns.
In other recent news, Boyd Gaming Corporation outperformed Q3 estimates, driven primarily by robust performances in its online and managed sectors. The company posted adjusted earnings per share of $1.52, surpassing the analyst consensus of $1.40. Revenue was reported at $961.25 million, exceeding expectations of $916.51 million and marking a 6.4% YoY increase from $903.2 million.
The company's online segment and Managed & Other segment, which includes Sky River Casino in northern California, exhibited strong revenue and Adjusted EBITDAR growth. This growth was attributed to increased contributions and one-time benefits from market-access agreements.
Boyd Gaming's Total Adjusted EBITDAR rose to $336.6 million in Q3, up from $320.8 million in the same period last year. In a recent development, the company repurchased $202 million in shares as part of its ongoing buyback program. As of the end of September, Boyd Gaming had approximately $343 million remaining under its current share repurchase authorization.
InvestingPro Insights
To complement the analysis of Boyd Gaming's recent performance and Mizuho's price target increase, InvestingPro data offers additional insights into the company's financial health. Boyd Gaming's market capitalization stands at $5.9 billion, with a P/E ratio of 12.57, indicating a relatively modest valuation compared to its earnings. This aligns with the positive outlook expressed in the Mizuho report.
InvestingPro Tips highlight Boyd Gaming's impressive gross profit margins, which are reflected in the latest data showing a gross profit margin of 62.34% for the last twelve months as of Q2 2024. This robust margin supports the company's ability to invest in high-return projects as mentioned in the article.
Another relevant InvestingPro Tip notes that Boyd Gaming has been profitable over the last twelve months, with an operating income margin of 24.67%. This profitability underscores the company's strong operational performance, which has led to the earnings beat discussed in the article.
For investors seeking more comprehensive analysis, InvestingPro offers 5 additional tips that could provide further context to Boyd Gaming's financial position and market performance.
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