Published on: November 5, 2024, 02:55h.
Last updated on: November 5, 2024, 03:08h.
Following a strong third-quarter earnings report, Century Casinos (NASDAQ: CNTY) saw a 12% increase in its stock on Monday. The rally continued on Tuesday, with analysts predicting further upside potential for the stock in the coming year.
Stifel analyst Jeffrey Stantial reaffirmed a “buy” rating on Century Casinos’ shares and raised the price target to $5 from $4 in a recent report to clients. This indicates a potential 25% upside from current levels, following the stock’s 55.45% surge in the past month.
Nugget Casino, Rocky Gap, Mountaineer, & Poland all contributed to upside, though we were most encouraged by sequential improvement at Nugget Casino following recent property management changes with the Q3 exit-rate approaching pre-acquisition productivity,” wrote Stantial.
The Nugget, located in Sparks, Nev., has shown signs of improvement after recent management changes. Despite previous challenges, the casino could positively impact Century’s financial results in the fourth quarter of 2024 and beyond.
Century Casinos Could See Normalized 2025 Earnings
Although Century Casinos faced difficulties earlier this year, the recent stock performance suggests a potential turnaround in 2025.
With the opening of a new land-based casino hotel in Caruthersville, Mo., and the reopening of a Poland casino, Century is poised to achieve more normalized earnings next year. The stock remains attractively priced even after the recent rally.
“Shares have outperformed nicely T1M, though valuation still sits at the low end of peers while FY25 targets appear increasingly attainable,” added Stantial.
In addition to its Colorado properties, Century operates gaming venues in Maryland, Nevada, West Virginia, Missouri, and Canada.
Poland Sale Still on the Table
Century has been considering selling its stake in Casinos Poland, with recent developments potentially expediting the process. The influx of refugees from Ukraine to Poland has boosted traffic to Century’s gaming venues in the country.
While Century’s Poland operations exceeded estimates in Q3, management is open to divesting non-core assets in the region.
During a conference call, Century executives expressed willingness to sell non-core Poland assets following the completion of the relicensing cycle in the country.