Gaming and Leisure Properties Lauded as Lower Risk Casino Real Estate Play

Gaming and Leisure Properties (NASDAQ:GLPI) caudex is higher past more than 2 percent Th next an indorsement from a sell-side analyst.

Initiating reportage of the gaming real estate investiture trust (REIT), Mizuho Securities USA analyst Haendel St. Juste rates GLPI buy in a “buy” with a $47 terms target. That’s somewhat beneath the Wall Street consensus of $48 and implies upside of to a greater extent than 11 percent from the Mar 31 close. He’s the 15th psychoanalyst covering the stock and the eleventh with a real bullish rating on the name.

GLPI (offers) strong underlying tenant deferred payment and structural letting enhancements (i.e., get the hang leases), resulting inwards a lower-risk weapons platform that we trust is under-appreciated past the market and has been cay to GLPI’s (and peers’) streak of 100 percent hire collections since GLPI’s inception,” said the psychoanalyst in a short letter to clients.

The company’s most direct competitors are MGM Growth Properties (NYSE:MGP) and VICI Properties (NYSE:VICI).

GLPI Stock Steady Idea in Steady Group

Following the initial moving ridge of coronavirus cases inward the US, the gaming REITs were punished alongside their operator tenants as investors interlaced nigh lease assembling and the specter of possible foreclosures.

Ultimately, names such as GLPI proved resilient not only when among gaming equities, but relative to the broader universe of real acres stocks. While hotel, mall and office REITs were repudiated at the hands of the pandemic, GLPI and rivals delivered astral rent accumulation yet as tenants dealt with multi-month shutdowns crossways the country. Ultimately, foreclosure fears proven unfounded, helping GLPI gillyflower to a pull in of 55 percent over the past tense twelvemonth — far in the lead of the 31.51 percent returned past the MSCI US Investable Market Real Estate 25/50 Index.

St. Juste, the Mizuho analyst, says GLPI and its peers are “winners inwards the retrieval of the U.S. economic system as consumer outlay and gaming revenues recover/grow.”

GLPI owns the property assets of 48 gaming venues crosswise 16 states. Its largest renter is Penn National Gaming (NASDAQ:PENN) though it leases properties to some littler operators as well.

Conservative Idea

As St. Juste notes, GLPI has a lower danger portfolio of assets. That’s by design as executives previously sonant preferences for regional gaming existent estate, opting to eschewing the volatility associated with Las Vegas and other destination markets.

Currently, the REIT owns simply leash venues inwards Southern Nevada and it’s shopping Tropicana Las Vegas. Earlier this year, GLPI direction said there’s plentitude of interest group inward that integrated resort, but many prospective buyers want the financial resources to wee-wee fair to middling offers.

That scenario could convert as the economy improves and as the Strip shakes off the effects of COVID-19. In the meantime, GLPI isn’t inward a hurry to sell the Tropicana, indicating it tin hold off for to a greater extent compelling offers.