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UPDATE - Nomura Securities Initiates Coverage on Boyd Gaming (BYD) with a Neutral; Recovery in Locals Offset by Competition

February 9, 2012 11:31 AM EST
BYD Hot Sheet
Rating Summary:
    2 Buy, 12 Hold, 4 Sell

Rating Trend: Down Down

Today's Overall Ratings:
    Up: 16 | Down: 7 | New: 23
UPDATE - Nomura Securities initiates coverage on Boyd Gaming (NYSE: BYD) with a Neutral. PT $10.50.

Analyst, Harry Curtis, said, "We expect a moderate recovery in the Las Vegas Locals market to be offset by continued deterioration in Atlantic City (AC). Our 2012/13 EBITDA estimates are 2% and 6%, respectively, above consensus. In BYD's most important market, Las Vegas Locals, we expect mid-single-digit revenue recovery and low-teen EBITDA growth. In AC, the May opening of the Revel casino adds an incremental risk. Through 2013, we expect the decline in AC EBITDA to offset recovery in Las Vegas Locals EBITDA. Unless the Locals EBITDA picks up faster than we expect, total EBITDA may hover in the $500mn area for the next 2-3 years. BYD’s regional peers are trading at ~7.5x trailing EBITDA."

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