Crimson Rock Inventory Pullback Might Be Shopping for Alternative, Says Analyst

• Inventory endured a brutal October
• Pullback makes it extra enticing on valuation
• Crimson Rock is without doubt one of the high development tales amongst on line casino shares, says analyst

Crimson Rock Resorts (NASDAQ: RRR) inventory endured a dismal October, retreating greater than 10% — a decline that included a 7.12% drop final week — however no less than one analyst believes the pullback is offering long-term traders with a gorgeous entry level.

Crimson Rock On line casino-Resort. Latest weak point within the inventory could possibly be a shopping for alternative. (Picture: YouTube)

In a brand new report back to purchasers, Stifel analyst Steven Wieczynski upgraded the inventory to “purchase” from “maintain” with a $68 value goal, implying upside of roughly 26% from present ranges. Wieczynski says one of many causes Crimson Rock offered off following what have been spectacular third-quarter earnings is as a result of traders have been hoping administration would announce a brand new from-the-ground-up on line casino venture, however all they acquired was information of one other enlargement at Durango On line casino & Resort in Southwest Las Vegas.

Primarily based on our conversations with traders, we predict there was a major quantity of momentum behind the shares heading into earnings anticipating an announcement relating to a brand new greenfield growth venture earlier than the top of FY25, which might have served as a catalyst for out-year earnings earlier than curiosity, taxes, depreciation, and amortization (EBITDA) estimates to be revised meaningfully greater,” observes Wieczynski.

Buyers have been possible hoping for updates on Crimson Rock’s deliberate on line casino resort within the Inspirada group in Henderson, Nev., or plans for 123 acres of land the operator owns close to the South Level Resort On line casino. Neither materialized in earnest on the corporate’s earnings convention name, maybe compelling traders to look elsewhere.

“Thus, we imagine traders who have been enjoying for a brand new on line casino growth announcement (which has now been taken off the desk till mid-FY26 on the earliest, in our opinion) subsequently moved on, inflicting many of the promoting strain weighing on the share value in latest days,” provides Wieczynski.

Crimson Rock Inventory Nonetheless Holds Attract

Whereas shareholders might have been disheartened by the dearth of reports relating to a brand new Las Vegas-area on line casino growth, there’s nonetheless ample fortification for the Crimson Rock bull thesis, which provides to the notion that the pullback could possibly be a shopping for alternative.

For instance, a 3rd enlargement at Durango, which can convey a movie show, bowling alley, and extra gaming house, amongst different facilities, confirms the energy of that venue. Plus, Crimson Rock not embarking on a brand new growth whereas it’s tending to Durango additions reveals the operator isn’t biting off greater than it chew, financially talking.

“Placing the Durango part three announcement apart, we really suppose RRR had the strongest 3Q25 print and ahead commentary of any brick-and-mortar on line casino operator beneath our protection given the very fact RRR skilled not one of the weak point that confirmed up in different Las Vegas locals/Strip operators’ outcomes,” mentioned Wieczynski.

Along side its third-quarter earnings replace, Crimson Rock additionally introduced a modest dividend hike and a rise to its share buyback plan, confirming its shareholder rewards story stays vibrant.

Crimson Rock a Prime Progress Story

In what’s been a making an attempt 12 months for a lot of on line casino shares, discovering standouts isn’t troublesome. Buoyed by superior belongings that pave the way in which for market share positive factors amongst higher-end Las Vegas locals, Crimson Rock could also be one of many high long-term development tales amongst gaming equities.

Some argue that the Las Vegas locals section is probably the most compelling gaming demographic, and Crimson Rock is the one publicly traded pure-play identify on that theme.

“We’d argue that RRR is without doubt one of the greatest development tales throughout gaming, reflecting a deep pipeline of excessive return on funding growth/enlargement initiatives,” concludes Wieczynski. “We imagine RRR is uniquely insulated/positioned from nearly all of any macro pressures versus different gaming firms inside our protection.”