Gabelli Bullish on Golden Entertainment, Wynn Resorts: Top Gaming Stocks to Watch

Gabelli Bullish on Golden Entertainment, Wynn Resorts: Top Gaming Stocks to Watch. When analyzing the volatility and potential of the broader casino industry, Mario Gabelli, the chairman and chief executive officer of Gabelli Funds, offers a strategic perspective on gaming stocks. He remains notably constructive on specific holdings within this sector, specifically highlighting Golden Entertainment (NASDAQ: GDEN) and Wynn Resorts (NASDAQ: WYNN).

Investment Pick for Gaming Stocks

The pair of Las Vegas-based casino operators were among the fund manager’s seven stock picks in the latest edition of the Barron’s “Roundtable.” Gabelli was one of five panelists that doled out 34 investment ideas for this year and he was the only member of that quintet to highlight gaming stocks.

He mentioned the royalty payments Golden Entertainment receives from the sale of its route business to J&J Gaming and the operator’s property holdings as potential catalysts for the shares.

Golden Entertainment: A Valuable Asset

Golden owns the Strat hotel casino on the Strip,” Gabelli told Barron’s. “It is a work in progress. But the company has nine extra acres of land across from the Strat, which are extremely valuable.

The Strat: A Key Property Holding

However, some may question whether the Strat, which actually isn’t on the Las Vegas Strip, but is near it, represents a key property holding for Golden Entertainment. Gabelli’s bullish stance suggests otherwise.

Wynn Resorts: Upside from Tilman Fertitta’s Stake

Regarding Wynn Resorts, Gabelli sees potential in the stock by way of Tilman Fertitta’s nearly 10% stake in the company and its plans to open a casino hotel in the United Arab Emirates (UAE).

A Partnership Opportunity?

Gabelli might have broken some news when he told Barron’s there’s talk Fertitta and Wynn could partner on a Houston-area integrated resort should Texas approve casino gaming. For now, it appears as though the state doing is a long shot and it’d be an interesting partnership because Fertitta owns the Golden Nugget casinos.

However, some analysts have mentioned that his interest in Wynn includes pushing the operator to better leverage its brand in the US. The company’s net debt, ex-Macau, is $3.7 billion. Wynn has significant cash-flow and earnings power. The company has secured a gaming license in the United Arab Emirates and will own a stake in the Al Marjan Resort there.

Wynn Al Marjan Island: A Positive Catalyst

Located in Ras Al Khaimah, UAE, Wynn Al Marjan Island will be the Middle East’s first casino resort and is scheduled to open in early 2027. Analysts have previously mentioned the project’s potential isn’t reflected in Wynn’s share price, indicating it could be a positive that Gabelli explicitly mentioned the UAE property.

Gaming Industry Insights

Another one of Gabelli’s stock picks for this year is media giant Fox Corp. (NASDAQ: FOX). While that company doesn’t directly own casinos or sportsbooks, its leverage to the fast-growing online sports betting space was highlighted by the fund manager.

Gaming Industry Trends

Fox owns 2.4% of Flutter Entertainment (NYSE: FLUT) and through that relationship, the media giant has rights to eventually purchase up to 18.6% of FanDuel — the largest internet sportsbook operator in the US.

Conclusion

In conclusion, Gabelli’s investment picks offer valuable insights into the gaming industry’s potential for growth and opportunities. Golden Entertainment and Wynn Resorts are among his top picks, driven by their strategic property holdings and potential partnerships.

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