With Macau and Singapore getting most of the gaming headlines sometimes we forget that there is indeed a large gaming business here in the U.S. One of the larger operators, with 18 casinos now under its control, is Penn National
Revenue was up 15% in the quarter to $687.9 million, and earnings per share jumped to $0.71 from $0.09 a year ago. Earnings were affected negatively by Hollywood Casino Tunica closing because of flooding and by a positive impact from the addition of M Resort to the portfolio in June.
At M Resort in Las Vegas, which I think was a great investment at $230.5 million, property EBITDA was $2.1 million for the month of June. This wasn't a big impact on the quarter, but if we just multiply that by 12 months, we see that $25.2 million in EBITDA is the run rate we saw this month. With improvement in operations and a currently slow locals market, that number should improve significantly.
Competing in an increasingly competitive U.S. market, Penn National looks much stronger than Ameristar Casinos
The hidden gem of gaming
We might overlook smaller-market casinos, but Penn National has actually outperformed Las Vegas Sands
For a local gaming play, Penn National is as good a bet as any.