Since there is little in this world more “consumer discretionary” than entering a casino and throwing money away at slot devices, craps tables and roulette, it’s of note when casino/resort stocks head lower and lower. That’s been the case lately for these 4 companies, all of which are bouncing off of new 52-week lows
That investors are backing away from the most consumer discretionary sector in the world is probably a bad sign for the economy as a whole. A thriving, healthy casino/resort industry typically marks the outlook as good — when concerns for this group arise, it’s as clear a negative indicator as any.
4 Gambling Stocks With New Lows.
Las Vegas Sands (NYSE: LVS).
Miriam Adelson and family own more than half of the company and watching the stock drop from $55 in February to $37 in August can’t have been too much fun. It’s bouncing off of the lows now but that the 50-day moving average crossed below the 200-day moving average in early May is not a happy signal. The relative strength indicator (RSI, below the price chart) is coming out of its “oversold” range. Market capitalization for Las Vegas Sands is $28.35 billion.
Melco Resorts and Entertainment (NASDAQ: MLCO).
Market cap is $2.63 billion for the Hong Kong-based Melco, one of the smaller of the publicly traded gambling companies. The stock traded as high as $9.50 at the beginning of the year and now goes for $5.51, a 42% slide. Note that it’s only traded briefly above a steadily declining 200-day moving average (in May) and the 50-day moving average is trending downward.
MGM Resorts International (NYSE: MGM).
The stock had been trading steadily up and down along the path of the 200-day moving average for months — but lost that over the last 5 sessions, hitting a new low of just under $34 before bouncing higher. With a market capitalization of $11.29 billion, MGM in late July had reported 2nd quarter earnings that beat the expectations of analysts.
WYNN Resorts (NYSE: WYNN).
Market cap is $8.55 billion. WYNN traded at $110 in early April and dropped to as low as $73 this week, a 33% slide for the Las Vegas-based company. You can see how the 50-day moving average crossed below the 200-day moving average in late June, a forewarning of the selling to come. The stock is coming out of the relative strength indicator’s “oversold” zone.
Not all casino/resort equities are just now bouncing off of new lows: Bally’s (NYSE: BALY) traded as low as $10 in March and now sells at $16.97 and Caesars Entertainment (NYSE: CZR) hit a new low of just below $32 in late May and managed to remain above that level during this week’s sell-off.
Additional price chart analysis and commentary at johnnavin.substack.com.
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