Boyd Soars Following Surprising Financial Update

https://www.casino.org/news/boyd-is-soaring-and-an-analyst-sees-multiple-drivers-for-more-upside/

Interesting article especially --

Boyd ended the quarter with $1.31 billion in cash and said that 25 of the 26 properties it reopened since May generated positive free cash flow (FCF). The California Hotel and Casino in downtown Las Vegas is the exception.

But lets keep this stock rolling...

 

I am gradually getting out of individual stocks. Bought Boyd at $14 in April, sold at $25 in June.

 

Interesting how they used a picture of MSS in the article.

 

See, tightening up the VP pay tables did account for something positive

 

I wonder how long they can sustain those results. Getting rid of 25% of staff certainly helped the salary expense numbers, but either they had too much headcount beforehand, or service down the road will suffer in a so-called service economy business. Secondly if my local Ameristar St. Charles property is any indication, the remodeling and maintenance budgets are practically nonexistent. Supposedly they had all the shut down time to Boyd clean, and the place still smells like a stale ashtray. Machines are in less than fully functioning shape, even taking into account the ones that are shut off for social distancing. If I had a crystal ball and a Ouija board, I should have invested in plexiglas and lumber stocks before the shutdown!

 

From what I saw on this trip...
I dunno guys... soar?
you should see these pictures I took..
Cal definitely would be the exception.
It was so dead and shut down it almost felt like they were on a mission to make the numbers so bad they'd shut down and probably lay off more people..
just MHO, these eyes are getting old, maybe blurry even.
I've never ever ever seen such emptiness,
and the further into Fremont you went, the busier it got..

added: Maybe it is an indication of Table players not preferring the plexiglass, \
IIRC I don't think I saw any at any downtown table....
All Cals tables, except craps, maybe roulette are Plexi'd up.

When I saw this red tape mod, I wondereded how many people had faceplanted into them first..
they appear pretty functional in putting you into a little aquarium bubble.

 

Agree, Ameristar St Charles cut way back on staff, no buffet, etc. They have been packing people in and until recently it was the only casino in the area NOT requiring a mask. (Though enforcement Sat. looked non-existent, lots of chin straps or no mask at all) Now add in that in St Louis county across the river they now require bars close at 10pm pushing more people there.
Player lounge has been way cut back from food to snacks only most days, with bare bones staff. Free buffet benefit for top few tiers is gone with no alternative provided.
I've cut my play there and let my host know my feelings, but really don't think they care. Wouldn't surprise me if they try to make some of those changes permanent.

 

Great percentage profit in a very short period!

 

Same thing for Penn National, my local Hollywood is down 50% in revenues, 2,199 slots and only 1,400 are open, but stock is at 5 year high.

 

Stock prices are based on future earnings. So I would think that means that the future will be bright (post COVID).

 

It's probably mostly running off their Fanduel deal, and sports starting:
https://www.prnewswire.com/news-releases/boyd-gaming-fanduel-group-announce-strategic-partnership-300690632.html
https://www.bleachernation.com/sports-gambling/2020/07/20/draftkings-and-fanduel-receive-temporary-operating-permit-in-illinois-launch-imminent/
while casino profit is down, IIRC, sports betting handle since open is up YOY.

owns 5% Fanduel?

 

It is shocking, local casinos I have seen did absolutely nothing in the way of maintenance during the shutdown. I mean nothing. They literally flipped the lights off and turned them on 3 months later, just in time to slap down a few signs about wearing masks. Now they have cut every expense imaginable (no more drawings, to promote social distancing! Lounges closed, to stop covid! No free food, restaurants closed anyway! Free valet parking? What are you thinking? Free soda and coffee? Can’t take that risk! Hosts available? No way, staying home to halt the spread...and on and on.)

This is not Boyd specific, but given the pent up demand and the reduced promo/service costs, I’m not surprised locals type casinos without the massive overhead of a Strip property are doing very well financially.

 

as far as Cal, MSC open from 4pm -1am, and Friday night plexi'ed table games closed till noon Sat is not going to draw the throngs.
also Hawaii.

the cocktail waitresses though, they're fighting the good fight.

added: and the cleaning crew too, I got fogged out of the back door VP zone once, left because I didn't want to breathe whatever they were spraying, but it looked like a fogger/leafblower that was misting clouds that were going to get into every crack...

 

When I was at The Cal, 2 weeks ago, and in late June, I did see them cleaning banks of machines regularly.
They have a log sheet on each bank, with the cleaning times.

 

Now college football is canceled.

 

At the cal w@Ty in early June I was surprised at the lack of preparation during the closing. For example, the taps in the sports book weren’t operational as they hadn’t been “bled” nor cleaned while closed. So only bottled beer.....which was ok too.
But agree with above, saw sign in sheets for cleaning banks of machines with time date and signature/ initials.
It was as if they just decided to open Monday and picked Thursday as the day to do it. And waited til Thursday to ask “I wonder what we need to get going?”

 

Agree with @dankyone, they continue to pack them in at the Ameristar St Charles. Lots of younger people, wedding events have resumed. Yet staff still cut, no buffet, no promos, long lines at cashier as they only reopened one. No machines shut down. Sanitizer stations often empty. Surprisingly they started requiring masks at their decision, barely enforced as they hardly have enough staff to do their regular jobs. Probably one of Boyd's highest grossing locations, if not the highest now.

 

There was a really good article from TravelZork on this.
Writer loved the stock etc., as an investor, but as a customer, had the same issues as us, regarding the slot club.

https://travelzork.com/vegas-news-august-2-2020/

 

If they are claiming that Aliante isn't losing money since reopening then their statement is a total lie...I don't think they were making money BEFORE Covid closed Vegas down..just not enough customers in the place...Even the money I dropped on the Pai Gow tables last week wouldn't keep them afloat..

 

"Free Positive Cash flow isn't the same as 'Making Money". They can be delaying payments and putting off expenses and accruing liabilities while building up their cash pot.