Red Rock Resorts (NASDAQ:RRR) Issues Earnings Results

Key Points

• Red Rock Resorts reported earnings of $0.68 per share, surpassing analysts' expectations of $0.35 by $0.33.
• The company's stock price rose 1.4% to $59.24 following the earnings announcement, with an increasing trading volume of 709,652 shares.
• Several hedge funds have recently increased their stakes in Red Rock Resorts, indicating strong institutional interest with 47.84% of shares owned by institutional investors.

Red Rock Resorts (NASDAQ:RRR - Get Free Report) released its earnings results on Tuesday. The company reported $0.68 earnings per share (EPS) for the quarter, topping analysts' consensus estimates of $0.36 by $0.32, Zacks reports. The firm had revenue of $475.57 million during the quarter, compared to analysts' expectations of $477.25 million. Red Rock Resorts had a return on equity of 59.97% and a net margin of 8.89%.The company's revenue was up 1.6% on a year-over-year basis. During the same quarter in the prior year, the company earned $0.48 EPS.

Red Rock Resorts Price Performance

Shares of NASDAQ RRR opened at $59.24 on Wednesday. The stock has a market capitalization of $6.25 billion, a price-to-earnings ratio of 20.15, a PEG ratio of 2.18 and a beta of 1.47. The business has a 50-day moving average of $60.40 and a 200-day moving average of $53.94. The company has a debt-to-equity ratio of 11.28, a current ratio of 0.89 and a quick ratio of 0.84. Red Rock Resorts has a fifty-two week low of $35.09 and a fifty-two week high of $63.60.

Analyst Upgrades and Downgrades

A number of research firms have issued reports on RRR. Morgan Stanley increased their target price on Red Rock Resorts from $49.00 to $53.00 and gave the stock an "equal weight" rating in a report on Wednesday, August 6th. Susquehanna reiterated a "positive" rating and set a $68.00 target price (up previously from $65.00) on shares of Red Rock Resorts in a report on Wednesday, July 30th. Stifel Nicolaus set a $60.00 target price on Red Rock Resorts and gave the stock a "hold" rating in a report on Wednesday, July 30th. Mizuho raised their price objective on Red Rock Resorts from $59.00 to $62.00 and gave the company an "outperform" rating in a report on Thursday, July 31st. Finally, JMP Securities raised their price objective on Red Rock Resorts from $64.00 to $65.00 and gave the company a "market outperform" rating in a report on Tuesday, September 16th. Eight equities research analysts have rated the stock with a Buy rating and five have given a Hold rating to the company. According to MarketBeat.com, the company has an average rating of "Moderate Buy" and an average price target of $61.40.

Insider Buying and Selling

In related news, CFO Stephen Lawrence Cootey sold 121,400 shares of Red Rock Resorts stock in a transaction dated Friday, August 1st. The stock was sold at an average price of $60.04, for a total transaction of $7,288,856.00. Following the completion of the transaction, the chief financial officer owned 260,268 shares in the company, valued at approximately $15,626,490.72. This trade represents a 31.81% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the SEC, which is accessible through this hyperlink. Also, EVP Jeffrey T. Welch sold 56,653 shares of Red Rock Resorts stock in a transaction dated Friday, August 1st. The stock was sold at an average price of $60.23, for a total value of $3,412,210.19. Following the transaction, the executive vice president owned 314,767 shares of the company's stock, valued at $18,958,416.41. The trade was a 15.25% decrease in their position. The disclosure for this sale is available in the SEC filing. Over the last 90 days, insiders sold 262,703 shares of company stock worth $15,764,672. Company insiders own 53.28% of the company's stock.

Hedge Funds Weigh In On Red Rock Resorts

A number of hedge funds and other institutional investors have recently bought and sold shares of the business. Balyasny Asset Management L.P. grew its holdings in Red Rock Resorts by 53.8% during the second quarter. Balyasny Asset Management L.P. now owns 793,371 shares of the company's stock worth $41,279,000 after purchasing an additional 277,426 shares during the period. Millennium Management LLC grew its holdings in Red Rock Resorts by 56.2% during the first quarter. Millennium Management LLC now owns 430,150 shares of the company's stock worth $18,656,000 after purchasing an additional 154,839 shares during the period. Bank of America Corp DE grew its holdings in Red Rock Resorts by 19.3% during the second quarter. Bank of America Corp DE now owns 353,300 shares of the company's stock worth $18,382,000 after purchasing an additional 57,059 shares during the period. Marshall Wace LLP grew its holdings in Red Rock Resorts by 388.4% during the second quarter. Marshall Wace LLP now owns 181,909 shares of the company's stock worth $9,465,000 after purchasing an additional 144,666 shares during the period. Finally, Hudson Bay Capital Management LP bought a new position in Red Rock Resorts during the second quarter worth about $7,359,000. Institutional investors own 47.84% of the company's stock.

Red Rock Resorts declared that its Board of Directors has authorized a stock buyback plan on Tuesday, October 28th that authorizes the company to repurchase $300.00 million in shares. This repurchase authorization authorizes the company to buy up to 4.9% of its stock through open market purchases. Stock repurchase plans are generally a sign that the company's board of directors believes its shares are undervalued.

About Red Rock Resorts

Red Rock Resorts, Inc, through its interest in Station Casinos LLC, develops and operates casino and entertainment properties in the United States. The company owns and operates gaming and entertainment facilities, including Durango Casino & Resort and smaller casinos in the Las Vegas regional market.