Published on: May 20, 2026, 01:23h.
Updated on: May 20, 2026, 01:23h.
- Regional casino stocks have shown stronger performance post Q1 earnings compared to larger competitors
- Analyst indicates that regional casino stocks are primarily aligned with their fundamentals
- Projections suggest that regional entities will outperform Las Vegas Strip-focused rivals this year
The first-quarter earnings season has concluded for the gaming sector, revealing a distinct preference for regional casino stocks over their larger counterparts.
According to a recent report from Macquarie analyst Chad Beynon, regional operators achieved an average earnings before interest, taxes, depreciation, and amortization (EBITDA) increase of around 3% in the first quarter, compared to roughly 2% for larger firms. He further emphasizes “EBITDA minus stock reactions” as additional proof of the divergence in stock performance versus their underlying fundamentals.
“At the regional level, the overall average residual of 0% indicates that stocks generally mirrored fundamentals, yet several companies showed significant divergence,” the analyst states.
This group includes Boyd Gaming (NYSE: BYD), Century Casinos (NASDAQ: CNTY), Churchill Downs (NASDAQ: CHDN), and Red Rock Resorts (NASDAQ: RRR). Following their earnings reports, these regional casino stocks lagged behind their fundamentals. Conversely, the stocks of Full House Resorts (NASDAQ: FLL) and Monarch Casino & Resort (NASDAQ: MCRI) outperformed their fundamentals according to Beynon.
Stability in Regional Casino Stocks
Despite challenges such as rising gas prices, weakened consumer sentiment, and persistently high interest rates, the overall performance of regional casino stocks has remained robust this year.
This stability could appeal to investors seeking gaming exposure without succumbing to the volatility tied to the Las Vegas Strip and the fluctuating nature of sports betting stocks amid growing competition.
“Regional trends show steady, modest growth, although some markets are experiencing supply challenges,” Beynon observes. “In summary, the first quarter reaffirmed a solid underlying fundamental environment in Gaming, although stock movements were only slightly influenced by estimate adjustments, as numerous stocks displayed either under-reactions or over-reactions vs fundamentals, underscoring the ongoing significance of positioning, Vegas exposure, and macroeconomic uncertainties in stock fluctuations.”
The analyst has given “outperform” ratings to several regional operators, like Penn Entertainment (NASDAQ: PENN) and Red Rock, while assigning more cautious “neutral” ratings to Boyd, Full House, and Monarch.
Prospects for Las Vegas
On the Las Vegas Strip, early indicators of recovery are emerging, with operators noting resilience among high-income consumers and a robust calendar for conventions and meetings. However, the impending acquisition of Caesars Entertainment (NASDAQ: CZR) and its potential effects on rival MGM Resorts International (NYSE: MGM) are significant factors. Until that deal is officially confirmed—there are no assurances it will happen—investors heavily invested in Strip-centered stocks are likely to focus on analytics and management insights.
“Management commentary throughout Q1 highlighted a divided demand landscape, with luxury segments performing strongly, whereas core leisure remains inconsistent, particularly in Las Vegas where value-driven tendencies are evident,” concludes Beynon. “Operators maintain a positive outlook on group and convention demand for the second half and beyond, but investor attention continues to center around the trends in the mass market and the potential resurgence of promotions.”
The analyst holds “outperform” ratings for both Caesars and MGM.