Casino Stocks Climb With Growing Interest From Activist Hedge Funds

Multiple Casino stocks climbed higher on Wednesday given all the media speculation of the rising interest from activist hedge funds in the sector. The report speculated that investors in the sector had been influenced by the New York Post news report released late-Tuesday.

 

What the report revealed

 

The New York Post report revealed that the famous hedge fund Starboard Value had been trying to introduce major changes in the consumer goods company called Newell Brands and the cyber security firm Symantec by acquiring a whopping $500 million in MGM Resorts International.

 

However, another famous news outlet Bloomberg cited inputs from authorities familiar with the situation, stating that Starboard Value has not acquiring any shares at MGM Resorts International. In addition to this, the news agency further reiterated that Starboard Value had not had any said exposure to the casino stock. However, Bloomberg remarked that the hedge fund representative had refused to offer any official comment on the matter.

 

HG Vora’s plans

 

In its regulatory filing that was published on Tuesday, another hedge fund called HG Vora had also revealed its plans of acquiring a sizable stake in Creasers Entertainment. Going with the aforementioned information, the New York Post had published a report stating that sources directly associated with the matter had confirmed HG Vora’s intentions of introducing major changes in the casino giant that operates two of the most famous brands in the market namely the Harrah’s and Horseshoe.

 

Like several other famous hedge funds such as the Eminence Capital, Soroban Capital Partners and Canyon Capital, HG Vora too holds significant stake in MGM Resorts International. According to the news report, the shares for MGM Resorts International had registered a 3.1 % rise during the afternoon trade and the Caesars Entertainment climbed up 0.7%. In addition to this, both Wynn Resorts as well as Las Vegas Sands had also recorded an increase of 2.6% and 0.8% respectively in the afternoon trade.

 

Given the concerns of investors over the apparent weakness in Las Vegas casino revenues, the shares of all the four aforementioned casino companies registered a double digit plummet this year. Commenting on the revenue plummet, Caesars Entertainment remarked that they had already expected the low figures given the lack of any major events during the summer such as the Conor McGregor/Floyd Mayweather boxing event that took place in the season last year.