{"id":3794,"date":"2026-03-23T06:46:06","date_gmt":"2026-03-23T06:46:06","guid":{"rendered":"https:\/\/globalnewstoday.uk\/index.php\/2026\/03\/23\/wall-street-analysts-expect-casino-mergers-and-acquisitions-to-heat-up-cdc-gaming\/"},"modified":"2026-03-23T06:46:06","modified_gmt":"2026-03-23T06:46:06","slug":"wall-street-analysts-expect-casino-mergers-and-acquisitions-to-heat-up-cdc-gaming","status":"publish","type":"post","link":"https:\/\/globalnewstoday.uk\/index.php\/2026\/03\/23\/wall-street-analysts-expect-casino-mergers-and-acquisitions-to-heat-up-cdc-gaming\/","title":{"rendered":"Wall Street analysts expect casino mergers and acquisitions to heat up – CDC Gaming"},"content":{"rendered":"

With Caesars Entertainment considering a takeover bid, Wall Street analysts are expecting mergers and acquisition talks to heat up in the casino industry. Las Vegas-based operators’ best opportunity for growth is in untapped markets.
Gaming analysts have been mum in their notes to investors about a potential takeover of Caesar,s given the lack of public information. They had a chance to weigh in on that and other M&A possibilities when they appeared Thursday night before the Economic Club of Las Vegas, moderated by club vice president and casino consultant Oliver Lovat.
Barry Jonas, managing director with Truist Securities, and John DeCree, director of equity research at CBRE, were asked about reports from the Financial Times that Texas billionaire and casino owner Tilman Fertitta was one of the bidders for Caesars, which is also considering a possible management-led buyout.
DeCree said everything has been speculative, with some high-profile news reports of what might happen, but it\u2019s difficult to guess what will.
One item that came out is that the Caesars management team would stay in place. From an operational perspective, that wouldn\u2019t have much impact in Las Vegas, DeCree highlighted.
Jonas said Caesars doesn\u2019t need more than 50 properties and while the press reports are limited in details, this is not an opportunity to buy and gut it and have a strong return. The valuation is attractive from a free cash flow basis, he added.
\u201cLet\u2019s see if it\u2019s for everything or a couple of assets, but I\u2019m in the camp that we could see more M&A,\u201d Jonas said. \u201cCertainly, a high-profile transaction from one of the leading operators likely gets other boards of directors thinking if they should be looking at it as well.\u201d
Jonas asked if there\u2019s a scenario of going private and getting away from the public investors constantly hounding operators for short-term results instead of being long-term oriented.
\u201cThere’s a scenario that this could emerge in multiple years and be a successful transaction,\u201d Jonas said of Caesars. \u201cAt the same time, there\u2019s a lot of leverage. Caesars today is generating a lot of cash flow that over time will de-lever, but you wonder what the structure of a take-private transaction looks like and how much new leverage needs to come on. Given what we saw in 2008 with the Harrah\u2019s ($16.7 billion buyout from private equity), there\u2019s a focus of let\u2019s not repeat what happened that time.\u201d
DeCree also expects to see more M&A, saying Caesars has a large portfolio of assets. Interest rates for large corporations and the spreads are near record lows.
\u201cThe borrowing costs for casino companies are so far disconnected from equity prices,\u201d DeCree said. \u201cThat\u2019s why we\u2019ve been predicting some leveraged buyouts or private-equity action. We are starting to hear about it now, because you can borrow at such low cost of capital and buy casino companies at depressed equity valuations.\u201d
DeCree said The Mirage (Hard Rock) and Venetian (Apollo) acquisitions came from private entities rather than public companies. There\u2019s a lot of long-term growth, but it requires capital.
\u201cGolden Entertainment is undergoing management changes where public markets don\u2019t appreciate the long-term value or don\u2019t have the same time horizon,\u201d DeCree said.
If stock valuations hold indefinitely, Jonas reiterated that he expects to see more private transactions. The gaming manufacturing space has moved to going private and the questions are casinos heading in a similar direction.
\u201cClearly, if you are an executive and looking at your stock price languish for multiple years now and you have been buying back stock and it\u2019s not helping, you need to ask tough questions if you are doing everything you can and fundamentals are not enough is worth exploring other options,\u201d Jonas said.
The industry is in a low-growth phase and the impact to stock prices has been among investors to \u201cshoot first and ask questions later,\u201d Jonas said. There\u2019s no impending threat, but the question is getting to growth.
\u201cMost executives will say, \u2018I don\u2019t need to have so many properties,\u2019\u201d Jonas said. \u201cWhen Caesars got rid of the Rio, I would say the bulk of that EBITDA they kept in house. MGM has divested some regional assets. When deals were initially made and properties initially developed, there probably were only a handful of competitors within three hours. That has evolved, and we\u2019re faced with some difficult challenges with leases with the OpCo PropCo (sales and leaseback) model given the saturation we see in the U.S. Could we see a phase of deconsolidation? The Venetian is astounding and numbers putting up are amazing, but as part of a larger organization (with Las Vegas Sands), it was afterthought. Sometimes you need full focus, with one GM focused on one property and not one guy focused on four or five. I think there\u2019s an argument for de-consolidation at some point.\u201d
Companies with significant capital looking for growth realize it\u2019s hard to do in Las Vegas, the analysts said. They can build another resort, but going into a new market can put billions of dollars to work, DeCree said in pointing out Wynn Resort\u2019s $5 billion resort under construction in the United Arab Emirates and MGM Resorts International building in Japan.
\u201cMGM and their partners are spending over $10 billion in Japan,\u201d DeCree said. \u201cYou can put a lot of money to work and generate the returns you need to. They are going to have to look at big untapped markets that haven\u2019t brought gaming in. Las Vegas is still relevant, but the next frontier out there has been under pursuit.\u201d
That doesn\u2019t mean there aren\u2019t opportunities in Las Vegas, Jonas said. It has withstood a lot of challenges and will return to growth at some point. He pointed out the Seminole Tribe in Florida saw an advantage to having a presence in the city by buying out the former Mirage and replacing it with its Hard Rock brand.
\u201cIf you want to be a player, you need to be in Las Vegas,\u201d Jonas said. \u201cThe question is how many properties do you need? We can\u2019t have all wins across the Strip, and there may come a time you\u2019ll get a return on capital. Is there a scenario where a new party comes to the Strip and wants to put significant capital in for whatever reason like the Mirage that is worthy of consideration?\u201d
Redevelopment opportunities of scale in Las Vegas would come from another party that has a vision rather than existing operators, the analysts said.
\u201cThe Mirage is a good example of that,\u201d DeCree said. \u201cHard Rock was okay with taking that building offline for three years and factoring into that cost of return and spending significant capital.\u201d
DeCree said OpCo PropCo hasn\u2019t prevented capital investment, one of the biggest fears of the model. The Mirage is putting in close to $2 billion, while the Venetian has \u201cbeen a huge success story\u201d by acquiring it from Las Vegas Sands.
\u201cIt\u2019s a lease property, and they have spent more than $1 billion and have done tremendously well,\u201d DeCree said. \u201cMGM has continued to invest in its assets. They have just spent several hundred million dollars at the MGM Grand. One of the biggest fears of the model is you\u2019ll starve the Strip for investment and the good news is we have not seen that. The value of having an operation on the Strip is still so significant that investors and developers are still willing to put money to work in a big way.\u201d
Not everything, however, has worked out right away despite the investment, Jonas said. Early results from the Fontainebleau and Resorts World have been challenging and hopefully they can ramp up over time. Entering a market like Las Vegas without a database to draw from and the experience makes it more challenging.
\u201cOn paper it makes sense to get rid of lower-end properties, but you need a special buyer,\u201d Jonas said. \u201c(Hard Rock International Chair) Jim Allen and the Seminoles are not your everyday acquirer. They are very good at what they do and have a very good database and a lot of experience.\u201d
Both analysts praised the two major local casino operators in Red Rock Resorts and Boyd Gaming, whose stocks they said have been doing great and are executing on their strategies. The casino companies are benefiting from population growth and Red Rock has growth potential with the undeveloped parcels where it plans to build casinos.
DeCree said the question his firm often gets from investors is when the slowdown on the Strip will \u201cbleed into the local market.\u201d So far it hasn\u2019t and the two operators have streamlined operations and \u201cfigured out how to serve the consumer.\u201d
Buck Wargo<\/strong> brings decades of business and gambling industry journalism experience to CDC Gaming from his home in Las Vegas. If it\u2019s happening in Nevada, he\u2019s got his finger on it. A former journalist with the Los Angeles Times<\/em> and Las Vegas Sun<\/em>, Buck covers gaming, development and real estate.
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