Bally Shares Soar on Positive Outlook, New Leadership

Bally’s (NYSE: BALY) stock saw a surge on Monday thanks to the company’s promising preliminary fourth-quarter and 2023 revenue guidance, as well as the announcement of a leadership change. The regional casino operator forecast fourth-quarter revenue of $576 million, exceeding analysts’ expectations of $568.89 million, and projected 2023 sales of $2.5 billion to $2.6 billion, which is higher than the consensus estimate of $2.46 billion. They also estimated full-year EBITDAR to be $660 million to $700 million.

Incoming CEO Robeson Reeves commented, “Our core businesses are producing excellent cash flows. UK revenue organically increased 12% in the fourth quarter as regulations continue to take effect, and Asia had positive year-over-year organic growth in December, demonstrating our initiatives to maintain a competitive edge in that market have been successful.” His predecessor, Lee Fenton, is also resigning from the board of directors.

In terms of the interactive division, Reeves acknowledged that the North American performance in 2022 had been “unacceptable” and the company announced it would be reducing headcount by up to 15%, potentially resulting in charges of up to $15 million. However, they are looking at various options, including leasing technology structures, to ensure that the international interactive segment performs better.

Bally’s stock could receive more boosts from the introduction of new amenities at their Rhode Island venue, and the launch of a temporary casino in Chicago in the second half of 2021. This is in anticipation for their $1.7 billion integrated project in the third-most populous US city. Additionally, it has been suggested that Bally’s may be in negotiations with the Trump Organization to develop a casino-hotel on excess land near the Trump Golf Links in the Bronx.

In conclusion, Bally’s stock saw a surge due to their bullish fourth-quarter and 2023 revenue guidance, as well as a CEO change. Their interactive division in North America is being restructured to ensure better performance, and their Rhode Island venue, temporary casino in Chicago, and possible casino-hotel in the Bronx could further increase their stock.