Casino stocks climb as Penn National spinoff points to new model
(Reuters) - Shares of U.S. casino operators rose on Friday as Penn National Gaming Inc's (PENN.O) plans to spin off some real estate assets drew attention to a more tax-efficient structure that could benefit gaming industry investors.
Penn National's shares rose 38 percent after it announced plans on Thursday to hive off 17 casino properties into a new company that will operate as a dividend-paying real estate investment trust.
"This could be a trend within the gaming sector to distribute profits on a more tax efficient basis," JP Morgan analyst Joseph Greff said.
Ameristar Casinos Inc ASCA.O shares were the biggest gainers, up 13 percent at $19.10 on Nasdaq on Friday afternoon. Shares of MGM Resorts International (MGM.N) were up 3 percent at $9.68, after rising as much as 7 percent earlier.
Susquehanna Financial analyst Yinan Zhao wrote in a note that industry leaders Las Vegas Sands Corp (LVS.N) and Wynn Resorts Ltd (WYNN.O) would benefit less from a tax structure change, given their heavy exposure to Asian gaming markets.
Las Vegas Sands and Wynn Resorts (WYNN.O), which were both up about as much as 5 percent in early trading, were up 3 percent and 1 percent, respectively.
(Reporting by Chris Jonathan Peters in Bangalore; Editing by Anthony Kurian and Saumyadeb Chakrabarty)
- Housing, jobs data weaken, but overall economic picture still upbeat
- Putin critic Khodorkovsky in Germany after pardon |
- Target probe eyes overseas hackers; stolen cards for sale online
- Pizza outlet attacked as India, U.S. fail to cool diplomat row |
- New York Mayor-elect's reputation for lateness parodied on Twitter