Who Wins Among Casino Resorts?

With the travel and leisure sector especially hit hard by the coronavirus, it is worth setting out the key questions to ask when assessing which venues might recover more quickly and more successfully than others. Today, let’s take a look at casino resorts. Obviously, online gaming companies have benefited from “stay-at-home” mandates. No one has to wear a mask when sitting alone in his living room at home. But among physical gaming resorts, not all are made equal; not all offer the same amenities; and not all cater to the same clientele. Between late January and early April 2020, almost all publicly traded shares were hammered, amid nightmares that resorts might never open up again, or might never be profitable. But since that time, there has been a bit of a rebound, led by Caesars Entertainment. Here are important questions to keep in mind when trying to discern the comeback potential of such properties:

• Do gamblers need to fly on an airplane to get to the location, and is the location deemed particularly risky? In the past few weeks, Twin River Holdings of Rhode Island purchased casinos in several driving (not flying) destinations, including Louisiana, Nevada, and Atlantic City, New Jersey.
  
• Is the venue spacious enough that players can feel they are a safe distance from others? Here luxurious places with roomy parlors and dining venues like Wynn Las Vegas and the Bellagio (operated by MGM) have an advantage.
  
• Does the company possess a diversified portfolio of properties so that if, for example, Las Vegas goes into a lockdown mode, the company may still derive revenues from, say, Macau or Atlantic City? Las Vegas Sands boasts casinos in Macau and Singapore, locales that can more freely and quickly impose and then lift health requirements.
  
• Does the company have a deep pocket and the credibility to float A-rated bonds if necessary? A competitor like Boyd Gaming may have a tougher time struggling with debt loads than some of its competitors.
  

What lies ahead? Wynn casinos recently set forth out an impressive plan for reopening, which is now being assessed throughout the travel and leisure sector, from restaurants to cruise lines. The plan includes thermal cameras to screen for high temperatures among the guests. Regardless of whether the world turns back to normal soon or never, all venues will be looking to exploit any advantage they have in order to stay in business and, hopefully, expand.