Earlier this month, Century Casinos, listed as CNTY, reported a 23% increase in just one week. This means that the company has climbed an impressive 106% since the same date last year, making it one of the best performing and lucrative gaming equities on the market today. Century Casinos, Inc. operates within the casino-entertainment industry and is the proud owner of several casino gaming destinations in the US and Canada and has even made a name for itself in Argentina and Poland over the years.
The good news for investors who have just heard of the success of Century Casinos on the stock market, is that it’s not too late to invest. Industry analysts expect the stock to continue growing. The sudden surge in stock experienced earlier this month was a direct result of analysts’ commentary and projections for the company. David Bain, from B. Riley’s, publicly covered the gaming equity and gave it a buy rating with an $18 target price. This would suggest an appreciation potential of almost 40% from the close on April 30th. Bain, a trusted voice for investors, shared that Century Casinos properties are locals-based which means that factors such as fiscal stimulus and the vaccine drive are driving the increase.
In conjunction with the factors mentioned, the stock’s ascent also serves as confirmation that investors and analysts are prizing the company for its US exposure. This can be seen by the soaring of shares even while the operator tackled temporary venue closures in Poland and Canada. In the US, Century Casino’s list of operations are scattered throughout the country and can be found in West Virginia, Missouri, and Colorado.
While Century Casino is considered to be a small fish in a big pond compared to other region operators, the operator has become a favourite among analysts for its management strategy. The company has a reputation for effectively managing the integration of bolt-on acquisitions. The increase in stock has placed the operator in a very favourable position. At the end of 2020, Century casinos had around $63 million in cash which has likely grown significantly as a result of its soaring stock. This means that Century has the funds available to go shopping and do what they do best: acquire. In addition to this, insiders have shared that Century is seriously contemplating selling off its assets in Poland, which would increase the currency available. This outcome is looking more likely as Poland’s shutdown continues. This puts Century in a prime position to return acquiring companies which would result in the share price more than doubling overnight.
Bain suspects that Century Casinos is currently reviewing several regional casino acquisitions in the US and stated that he firmly believes that CTNY will announce its acquisition of a US casino before the close of the third quarter this year. However, Bain has yet to disclose any further projections on this front.
In addition to the support of analysts and a stellar acquisition management technique, Century Casinos will also be benefitting from legislative changes in Colorado state. In November last year, an alteration to the constitution, called Amendment 77, was passed and signed off by local authorities. This has resulted in Colorado’s operators being allowed to implement higher betting limits and introduced a range of new table games to patrons in the jurisdiction. It is expected that the removal of the $100 betting limit will be vital to operators who are looking to build longer-lasting relationships with high-end clientele. Local data analysts have shared reports that indicate that Colorado’s residents frequently visit Century Casino’s domestic venues to spend their cash and have a live casino experience after months of being shuttered in their homes.
Bain commented on this phenomenon, sharing that analysts believe local casino operators to be benefiting greatly from the pent-up demand in the state. The increase of maximum capacities at casinos, the vaccine rollout, and nearby entertainment have created perfect conditions for Colorado’s casino operator’s to try to build their brands and companies back up.