Why Casino Operators Caesars, MGM, and Wynn Rocketed Higher in August by as Much as 47%
Shares of casino operator Wynn Resorts (NASDAQ: WYNN) jumped a hefty 20% in the month of August according to data from S&P Global Market Intelligence. However, that was chump change compared to MGM Resorts International (NYSE: MGM), which saw its share price rise just under 40%. And even that advance was outdistanced by Caesars Entertainment (NASDAQ: CZR), which was up 47.5% in the month. It would be an understatement to say that August was good to casino names.
However, there's a larger picture here. Even after those big monthly gains, Caesars was still down by 23% through the first eight months of 2020. MGM was lower by 32% over that span. And Wynn pulled up the rear, with a 37% decline. At one point in the year the stocks were down between 60% and 90%, so the losses today represent a vast improvement. But all of this just speaks to the very real issues Wynn, MGM, and Caesars are facing.
The key thing to watch here, which is unlikely to surprise anyone, is COVID-19. The global effort to slow the pandemic led to governments closing non-essential businesses (casinos easily qualify) and enacting social distancing guidelines, both of which had investors fearing the worst during the early 2020 bear market. However, a lot has changed since April.
Source Fool.com
