5 Best Casino Stocks To Own For 2014

One of the troubles with market punditry is that people can pick different metrics to make whatever case they’re trying to make. Some cite variations of the P/E ratio to say the S&P 500 is overvalued. Others use different versions to say it’s undervalued.

Truth is probably found by looking somewhere in the middle. Last week, Charles Schwab chief investment strategist Liz Ann Sonders shared a unique way she likes to value market that does just that. Here’s what she had to say (transcript follows):

Sonders: I do like to look at forward P/E and make an assumption that estimates, or at least make a call that estimates are not aggressive on the high side or the low side, so if you have some confidence that the stream of estimates over the next 12 months is not out there, then I think it’s valid, given that the market is a leading indicator to look forward and not drive the car purely with the rearview mirror. Even on a trailing-12-month basis, the market is still pretty cheap.

5 Best Casino Stocks To Own For 2014: Scientific Games Corp (SGMS)

Scientific Games Corporation (Scientific Games), incorporated on July 2, 1984, is a global supplier of solutions to lottery and gaming organizations worldwide. The Company’s products and services include instant lottery games, lottery gaming systems, terminals and services, and Internet applications, as well as server-based interactive gaming machines and associated gaming control systems. The Company reports its operations in three segments: Printed Products Group, Lottery Systems Group and Diversified Gaming Group. Printed Products Group is a provider of instant lottery tickets in the world. The Company’s Lottery Systems Group is a provider of customized computer software, software support, equipment and data communication services to lotteries. Its Diversified Gaming Group provides services and systems to private and public operators in the wide area gaming industry, including server-based gaming machines and sports betting systems and services. On September 23, 201 1, the Company acquired Barcrest Group Limited. During 2011, the Company launched MDI Interactive, a content services powerhouse dedicated to delivering gaming solutions for the Internet, mobile and all digital things. In October 2013, the Company announced that it has completed the acquisition of WMS Industries Inc.

Printed Products

Printed Products segment is primarily consists of instant ticket lottery business. The Company generates revenue from the manufacturing and sale of instant tickets, as well as the provision of value-added services, such as game design, sales and marketing support, specialty games and promotions, inventory management and warehousing and fulfillment services. It also provides lotteries with cooperative service programs (CSPs), to help them manage and support their operations. The Company also provides licensed games, promotional entertainment and Internet-based services to the lottery industry. It operates six instant ti cket printing facilities across five continents.

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The Company provides lotteries with access to some entertainment brands on lottery products through its subsidiary MDI Entertainment LLC (MDI). The Company’s licensed entertainment brands include Harley-Davidson, Major League Baseball, Monopoly, National Basketball Association, The Price is Right, Wheel-of-Fortune and World Poker Tour. It also provides branded merchandise prizes, advertising, promotional support, turnkey drawing management services and prize fulfillment programs. In addition, it offers lotteries a Web-based platform called Properties Plus, which features players clubs, reward programs, second chance promotional websites, interactive games and, subject to applicable law, a subscription system that enables players to purchase lottery games securely over the Internet. The Company owns 20% interests in LNS ad Northstar, and 49% in CSG.

Lottery Systems

The Company is a provider of customized computer software, software support, eq uipment and data communication services to lotteries. In the United States, the Company typically provides the necessary equipment, software and maintenance services pursuant to long-term facilities. Internationally, it typically sells terminals and/or computer software to lottery authorities and may provide ongoing fee-based systems and software support services. The Company’s lottery systems business includes the supply of transaction-processing software, draw lottery games, keno, point-of-sale terminals, central site computers and communication platforms as well as ongoing operational support and maintenance services. The Company is the instant ticket validation network provider to the China Sports Lottery.

The Company has lottery systems operating in Argentina, Australia, Canada, China, France, Germany, Hungary, Iceland, Israel, Latvia, Mexico, Norway, the Philippines, Spain, Sweden and Switzerland. In addition, it provides video lottery central monitoring , and control systems and networks primarily to lotteries an! d gaming ! regulators. It also provides software, hardware and support for sports wagering systems. The Company has 50% interest in Guard Libang, a provider of instant ticket activation and validation and inventory management systems and services.

Gaming

The Company is a provider of server-based gaming machines and systems and other products and services to operators in the gaming industry. The Company’s Gaming segment includes The Global Draw Limited (Global Draw), a supplier of server-based gaming machines and systems, and game content primarily to bookmakers that operate licensed betting offices (LBOs) in the United Kingdom, and to gaming operators outside the United Kingdom. The Gaming segment also includes Barcrest Group Limited (Barcrest) and Games Media Limited (Games Media), suppliers of gaming machines, systems and game content to pubs, bingo halls and arcades in the United Kingdom and continental Europe.

The Company provides its Gami ng customers with gaming machines, remote management of game content and management information, central computer systems, secure data communication and field support services. It develops its own game content, and supplements its offering with content from third parties. As of December 31, 2011, the Company installed approximately 23,100 LBO gaming machines in the United Kingdom, which included approximately 8,000 LBO gaming. As of December 31, 2011, it had an installed base of approximately 6,100 gaming machines in its United Kingdom pub, bingo hall and arcade business, and installed approximately 6,500 gaming machines outside of the United Kingdom. During 2011, the Company owned a 50% interest in Sciplay, a joint venture with Playtech Services (Cyprus) Limited. It also owns 29.4% interests in RCN, and 20% in Sportech.

The Compnay competes with Pollard Banknote Limited, GTECH, BI Worldwide Ltd., Alchemy3, LLC, ePrize, LLC, GTECH, Pollard, Intralot Technologie s, Inc., International Lottery and Totalizator Systems, Inc.! , Inspire! d Gaming Group Limited, Danoptra Ltd, Sceptre Leisure plc, Games Warehouse Limited, International Game Technology, Lottomatica, Bally Technologies, Inc., Inspired, Aristocrat Leisure Ltd, Novomatic AG, Multimedia Games, Inc., WMS Industries Inc., Konami Digital Entertainment, Inc., Amaya Gaming Group, Inc., Cryptologic Ltd., IGT, Microgaming Software Systems Ltd., Net Entertainment NE AB, NYX Gaming Group, OpenBet Technology Ltd. and Playtech Limited.

Advisors’ Opinion:

  • [By Travis Hoium]

    What: Shares of Scientific Games (NASDAQ: SGMS  ) jumped 10% in late trading today after signing an important customer.

    So what: The company announced that it has signed a contract extension to provide lottery gaming and instant ticket services for the Oklahoma Lottery. This was actually disclosed earlier this year, but investors bid up shares leading up to the announcement and nearly five times the three-month average volume of shares traded hands today.  

  • [By Stock Maelstrom]

    We are likely approaching the last time I will be reporting on WMS Industries (WMS), the former Williams Electronics. It has agreed to be acquired by Scientific Games (SGMS) for $26 per share, plus the assumption of WMS’ modest debt. The deal is scheduled to close by the end of this year. On its own, WMS is having a dismal fiscal year, which ends June 30. For this year, the company, no doubt with distracted management, earnings are likely to end at about $0.90 per share, compared with fiscal 2012’s $1.31 per share. Helping drive earnings lower are additional measures the company is taking to drive up revenues, which remain well below last decade’s peak. WMS’ stock has flat lined the past few months at within three percent of the $26 price. There is virtually no upside, though there is downside if the deal collapses. I see no reason to get invested in WMS.

5 Best Casino Stocks To Own For 2014: William Hill PLC (WMH)

William Hill PLC is a United Kingdom-based gambling company. The Company’s business is to provide its customers with a range of sports betting and gaming opportunities. It is a bookmaker providing fixed odds sports betting. It also offers gaming opportunities. The Company’s segments include Retail distribution channel, which includes activity undertaken in LBOs, including gaming machines; Online segment, which includes activity undertaken online, including an online sportsbook, online casino, online poker sites and other gaming products; Telephone segment, which includes its telephone betting services; US segment, comprises all activity undertaken in the United States; Other activities include on-course betting and greyhound stadia operations. In April 2013, it acquired the remaining 29% stake in William Hill Online from its joint venture partner Playtech Ltd. Effective September 2, 2013, William Hill PLC acquired Miapuesta.es, a provider of gaming and sports betting serv ices. Advisors’ Opinion:

  • [By Inyoung Hwang]

    Prudential Plc (PRU), which generated 32 percent of its operating income from Asia last year, climbed to its highest price since at least 1988. William Hill (WMH) Plc lost 3.2 percent after JPMorgan Chase & Co. lowered its rating on the bookmaker. Anglo American Plc (AAL) declined 1.4 percent after saying that production at its Kumba (KIO) Iron Ore Ltd. unit fell.

  • [By Inyoung Hwang]

    Royal Bank of Scotland Group Plc sank 3.3 percent after reporting results and naming the head of its U.K. consumer unit as chief executive officer. William Hill Plc (WMH) dropped the most in four years after the bookmaker posted earnings that missed analysts’ projections. International Consolidated Airlines Group SA (IAG) rose to a five-year high as the parent of British Airways reported an operating profit in the second quarter.

5 Best Casino Stocks To Own For 2014: Tropicana Entertainment Inc (TPCA)

Tropicana Entertainment Inc. (TEI) is an owner and operator of regional casino and entertainment properties located in the United States and one casino resort development located on the island of Aruba. TEI’s United States properties include three casinos in Nevada, three casinos in Mississippi, and one casino in each of Indiana, Louisiana and New Jersey. Its properties offer a range of gaming options. TEI’s properties include Tropicana AC in the East; Casino Aztar in Central; Tropicana Laughlin, River Palms and MontBleu in the West; Lighthouse Point, Jubilee, Belle of Baton Rouge, Horizon Vicksburg and Tropicana Aruba in the South and Other.

Tropicana AC

Tropicana Casino and Resort, Atlantic City (Tropicana AC) is situated on a 14-acre site with approximately 660 feet of ocean frontage in Atlantic City, New Jersey. In addition to gaming facilities, the property features The Quarter, a Havana-themed, Las Vegas-style, approximately 200,000 sq uare-foot indoor entertainment and retail center, hosting several restaurants, shops and an IMAX theatre. Other amenities include a 2,000-seat showroom, a full service spa and salon, a health club and indoor pool, a beach and pool bar and approximately 99,000 square feet of meeting and convention space.

Casino Aztar

Casino Aztar Evansville (Casino Aztar) is a casino hotel and entertainment complex in the state of Indiana. Over 60% of Casino Aztar’s revenues come from customers within a 50-mile radius. The property’s casino operations are located dockside on the three-deck City of Evansville riverboat. Located adjacent to the casino, the Company owns two distinctive hotels: the Casino Aztar Hotel, a 251-room hotel that offers guests a restaurant, conference rooms and banquet facilities; and Le Merigot Hotel, a luxurious 96-room boutique hotel with an upscale martini lounge. A 44,000-square-foot pavilion adjacent to the riverboat features three resta urants, an entertainment lounge, gift shop, coffee shop, pla! yers club and VIP lounge. The District at Casino Aztar includes two restaurants and the Le Merigot Hotel. Casino Aztar also includes a seven-story parking garage, as well as surface parking.

Tropicana Laughlin

Tropicana Laughlin Hotel and Casino (Tropicana Laughlin) is located on an approximately 31-acre site on Casino Drive, Laughlin. The casino at Tropicana Laughlin features a gaming floor. Non-gaming amenities include a heated outdoor swimming pool, seven restaurants, three full service bars, an entertainment lounge with live music, a lounge for high-end players, an 800-seat multi-purpose showroom and concert hall, meeting space, retail stores, an arcade and a covered parking structure. The property features 1,495 hotel rooms.

River Palms

River Palms Hotel and Casino (River Palms) is located on an approximately 35-acre site also on Casino Drive, with approximately 1,300 feet of frontage on the Colorado River. Non-gami ng amenities include 1,001 hotel rooms, 10,500 square feet of meeting and convention space, an outdoor pool, fitness center, three restaurants, three full service bars, a showroom, two entertainment lounges with live music and a covered parking structure.

MontBleu

MontBleu Casino Resort & Spa (MontBleu) is situated on approximately 21 acres in South Lake Tahoe, Nevada surrounded by the Sierra Nevada Mountains. In addition to the casino, the property offers guests a choice of three restaurants and various non-gaming amenities, including retail shops, two nightclubs, a 1,500-seat showroom, approximately 14,000 square feet of meeting and convention space, a parking garage, a full service health spa and workout area, an indoor heated lagoon style pool with whirlpool and a 120-seat wedding chapel.

Lighthouse Point

Lighthouse Point Casino (Lighthouse Point) is a 210-foot, three-deck, dockside riverboat located in Greenville, Mississippi. In addition to slot machines, the riverboat inc! ludes a d! eli and bars on each floor while the dockside facility includes a buffet, a bar and 386 onsite surface parking spaces.

Jubilee

Bayou Caddy’s Jubilee Casino (Jubilee), a 240-foot dockside riverboat, is located in Greenville. In addition to the casino facilities, the property includes a bar on each floor, a deli and approximately 700 parking spaces. The property also owns and operates the Greenville Inn & Suites, a 41-room suite hotel located less than a mile away, which offers free shuttle service to and from Jubilee and Lighthouse Point.

Belle of Baton Rouge

Belle of Baton Rouge Casino & Hotel (Belle of Baton Rouge) is a dockside riverboat situated on approximately 23 acres on the Mississippi River in the downtown historic district of Baton Rouge, across from the River Center, a 70,000-square-foot convention center. The three-deck, dockside riverboat casino is one of two casino facilities in the Baton Rouge market. Bato n Rouge is located 75 miles north of New Orleans. Non-gaming amenities include 300 hotel rooms, 25,000 square feet of meeting and convention space, an outdoor pool, a fitness center, two restaurants, a deli, and an entertainment venue inside a 50,000-square-foot glass atrium that also encloses a tropical lobby.

Horizon Vicksburg

Horizon Vicksburg Casino (Horizon Vicksburg) is a dockside riverboat situated on approximately six acres in downtown Vicksburg, Mississippi. The property features a 297-foot multi-level, antebellum style, dockside riverboat casino housing. Additional amenities include 117 hotel rooms, a restaurant, two covered parking garages as well as additional surface parking. In December 2010, the Company entered into an agreement to sell all of the assets and certain liabilities associated with the operation of Horizon Vicksburg.

Tropicana Aruba

The Company operates timeshare and rental units at Tropicana Aruba Resort & Casino (Tropicana Aruba), a casino resort und! er develo! pment in Noord, Aruba. This resort will have approximately 361 timeshare and rental units, an approximately 16,000 square foot permanent casino, two pools, a swim-up bar & grill, a fitness center and tennis courts, which will be located on approximately 14 acres near Eagle Beach.

Advisors’ Opinion:

  • [By Igor Greenwald]

    A majority stake in casino operator Tropicana Entertainment (TPCA) also began with a Chapter 11 restructuring.

    From January 1, 2000 to June 10, 2013, Icahn Enterprises has averaged a 20% annual return, multiplying investors’ money nearly 12-fold. Berkshire-Hathaway (BRK-B) has managed only a triple over the same span.

5 Best Casino Stocks To Own For 2014: Bwin.Party Digital Entertainment PLC (BPTY)

bwin.party digital entertainment plc (bwin.party) is a holding company. The Company is an online gaming company. It operates in five segments: sports betting, casino & games, poker, bingo; and other (including network services, World Poker Tour, InterTrader.com, WIN.com, software services and the payment services business). Its sport betting segment includes bwin, betoto, Gamebookers, Gioco Digitale and PartyBets. It’s Casino & games segment includes PartyCasino, bwin and GD Casino. Its poker segment includes PartyPoker, bwin and GD Casino. Its Bingo segment includes Foxy Bingo, Cheeky Bingo, Gioco Digitale and Binguez. The Company’s subsidiaries include BES SAS, bwin Argentina SA, bwin Italia S.r.l., bwin.party Games AB and Cashcade Limited. Its subsidiaries are engaged in management and information technology (IT) services, marketing services, online gaming, transaction services, customer support services, marketing support services and Land-based poker events. Advisors’ Opinion:

  • [By Namitha Jagadeesh]

    Bwin.Party Digital Entertainment Plc (BPTY) plunged 14 percent to 110 pence, the biggest drop since April 2011, after the online gaming company said 2013 sales will be 14 percent to 17 percent lower than last year’s figures. Analysts on average had forecast a sales drop of 9.2 percent.

5 Best Casino Stocks To Own For 2014: Dover Downs Gaming & Entertainment Inc (DDE)

Dover Downs Gaming & Entertainment, Inc., incorporated in December of 2001, is a premier gaming and entertainment resorts. The Company’s operations consist of: Dover Downs Casino, a 165,000-square foot casino complex featuring table games, including craps, roulette and card games, such as blackjack, Spanish 21, baccarat, 3-card and pai gow poker, the latest in slot machine offerings, multi-player electronic table games, the Crown Royal poker room, a Race & Sports Book operation, the Dover Downs’ Fire & Ice Lounge, the Festival Buffet, Doc Magrogan’s Oyster House, Frankie’s Italian restaurant, as well as several bars, restaurants and four retail outlets; Dover Downs Hotel and Conference Center, a 500 room AAA Four Diamond hotel with a full-service spa/salon, conference, banquet, ballroom and concert hall facilities, and Dover Downs Raceway, a harness racing track with pari-mutuel wagering on live and simulcast horse races. All of its operations are located at its entertai nment complex in Dover. Its two wholly owned subsidiaries include Dover Downs, Inc. and Dover Downs Gaming Management Corp.

Dover Downs Casino

The Company’s casino had approximately 2,539 slot machines as of December 31, 2011. It is open for business around the clock. During the year ended December 31, 2011, that the facility was visited by approximately 2.6 million patrons. Its slot machines range from penny machines to $100 machines in the Premium Slots area and include games found in the country’s major gaming jurisdictions. The Company operates with 40 tables, including blackjack, craps and roulette tables. The Crown Royal poker room has 12 poker tables. It has its Race and Sports Book operation featuring parlay sports wagering on NFL games and pari-mutuel wagering on live and simulcast horse races. Dover Downs, Inc. is authorized to conduct video lottery, sports wagering and table game operations. The Company’s Capital Club, a slots players clu b and tracking system, allows it to identify customers and t! o reward their level of play through various marketing programs.

Dover Downs Hotel

The Company’s luxury hotel facility, the Dover Downs Hotel and Conference Center, connects to the Company’s casino. The facility includes 500 rooms, including 11 luxury spa suites, a multi-purpose ballroom/concert hall, a fine dining restaurant, swimming pool and a luxurious 6,000 square-foot full-service spa. It offers a range of entertainment options to its patrons, including concerts featuring prominent entertainers, live boxing, gourmet dining, spa facilities, trade shows and conferences. During 2011, hotel occupancy averaged 90%.

Dover Downs Raceway

The Company’s Dover Downs Raceway conducts live harness races from November until April and is simulcast to more than 300 tracks and other off-track betting locations across North America on each of the Company’s more than 120 live race dates. The Company’s harness racing track is a 5/8-mi le track that is located on DVD’s property and is on the inside of its one-mile motorsports superspeedway. Additional amenities include the Winners Circle Restaurant overlooking the horse racing track. Within the Company’s Race & Sports Book operation is the simulcast parlor where the patrons can wager on harness and thoroughbred races received by satellite into its facility year round from numerous tracks across North America. Television monitors throughout the area provide views of all races simultaneously and the betting windows are connected to a central computer allowing bets to be received on all races from all tracks.

The Company has an agreement with the Delaware Standardbred Owner’s Association, Inc. (DSOA) effective September 1, 2010 and continuing through August 31, 2014. DSOA’s membership consists of owners, trainers and drivers of harness horses participating in harness race meetings at its facilities and elsewhere in the United States and Canada. Under the DSOA agreement, the Company is required to distrib! ute as pu! rses for races conducted at its facilities a percentage of its retained share of pari-mutuel revenues.

The Company competes with Harrington Raceway and Delaware Park.

Advisors’ Opinion:

  • [By Paul Ausick]

    The REIT is expected to spend as much as $500 million in acquisitions in 2014, according to Barron’s, and some potential acquisition targets include Isle of Capri Casinos Inc. (NASDAQ: ISLE) which has a market cap of around $323 million or Dover Downs Gaming & Entertainment Inc. (NYSE: DDE) with a market cap of around $47 million.

  • [By Paul Ausick]

    Stocks on the move: Vodafone Group PLC (NASDAQ: VOD) is up 8.1% at $31.80 on reports of discussions with Verizon Communications Inc. (NYSE: VZ) that would result in the sale of Vodafone’s 45% stake in Verizon Wireless to the controlling shareholder. Dover Downs Gaming & Entertainment Inc. (NYSE: DDE) is up 10.8% at $1.54 after Wednesday’s launch of its online casino games that will soon be available to state residents to play for real money.