Gaming industry stocks recouped some of their losses Tuesday as the markets recovered from their worst performance in two years 24 hours earlier. 

Caesars Entertainment, which had the largest percentage decline in the gaming sector Monday, regained more than 4 percent of its value Tuesday, closing at $34.57 on the Nasdaq. 

Red Rock Resorts, which saw a 3.7 percent decline Monday, saw its stock price jump 6 percent on the Nasdaq to close at $52.66, the largest percentage increase of any gaming company. 

Red Rock, in filings made late Monday with the Securities and Exchange Commission, said its controlling shareholders, CEO Frank Fertitta III and vice chairman Lorenzo Fertitta, bought back a combined 200,000 shares of the company’s stock over two days last week, spending a combined $10.6 million.

The stock price of MGM Resorts International jumped 3.9 percent to close at $35.40 on the New York Stock Exchange while gaming equipment manufacturer Light & Wonder saw a nearly 3.3 percent increase to close at $100.71 on the Nasdaq. 

The Dow Jones Industrial Average grew more than 294.39 points following Monday’s more-than 1,000-point decline. The Nasdaq increased by 166.77 points following its 3.4 percent, 576-point drop Monday.

Updated at 2:40 p.m. on 8/6/2024 with information on Tuesday’s gaming stock performance. Original story below:

Gaming sector not immune to Monday’s stock market tumble

Gaming industry stocks were not spared in Monday's more than 1,000-point decline by the Down Jones Industrial Average, the worst day for the market since 2022. The Dow fell 2.6 percent while the Nasdaq fell 3.4 percent, a 576-point drop.

The major publicly traded casino operators and gaming equipment providers experienced different degrees of decline. Caesars Entertainment lost 6.9 percent of its share price value on the Nasdaq, closing at $33.20. MGM Resorts International saw a nearly 4 percent decline on the New York Stock Exchange to close at $34.07 a share.

Of the gaming equipment companies, slot machine developers Light & Wonder experienced a nearly 5 percent decline on the Nasdaq to close at $97.51. International Game Technology’s stock price fell 1.3 percent on the New York Exchange to close at $21.38.

Locals casino operators were also down. Boyd Gaming fell 2 percent on the New York Exchange to close at $54.16 while Red Rock Resorts saw its stock price decline 3.7 percent to close at $49.66 on the Nasdaq. STRAT owner Golden Entertainment saw its stock price fall more than 6 percent to close at $27.78 on the Nasdaq.

Several analysts who follow the gaming industry told The Nevada Independent they wanted to hold back on their commentary to see if the tumble was just a one-day event or if the markets decline again Tuesday. 

They noted, however, that several casino companies have seen double-digit percentage declines in their stock prices during the past week, but didn’t provide any explanation.

The investment community has been primarily focused on second-quarter earnings announcements in the past few weeks. Wynn Resorts, Penn Entertainment and Light & Wonder are three of the larger gaming operators announcing earnings this week.

B. Riley Securities gaming analyst David Bain told the financial news site SeekingAlpha.com that he still had a positive outlook on the stock prices of most casino operators and gaming equipment providers, but investment uncertainty is weighing down the overall sector.

“We note most casino/supplier valuations are already trading several turns below historical averages despite reaching new gaming records and a history of sector revenue resilience,” Bain said.

Several analysts and economists told the Washington Post it was too soon to panic about the stock declines foreshadowing an economic slowdown.

“This is not the recession train; it’s just a good old-fashioned market panic,” Joe Brusuelas, principal and chief economist for RSM US told the Post. “This is not a D.C.-inspired event, about a slowing job market or the Fed being behind the curve. It’s about a larger regime change, where investors are adjusting to the end of easy money globally.”

Corrected at 6:05 p.m. on 8/5/2024 to clarify the decline in the Dow.