Gaming and Leisure Properties praised as Lower-Risk Casino Real Estate Play

On Thursday, Gaming and Leisure Properties (NASDAQ: GLPI) stock got gain by over two percent. The reason was because of approval from a sell-side analyst.

Real estate investment trust (REIT), Mizuho Securities USA analyst Haendel St. Juste rates GLPI, a stock to buy on a $47 price target.

$47 is below the Wall Street agreement of $48. However, it suggests an upside of over 11 percent. If we compare it from March 31. Haendel is the fifteenth analyst covering the stock. He is the eleventh with a positive rating on his name.

“GLPI is a strong holder of credit. They have basic lease enhancements. (i.e., master leases), which yields a lower-risk platform. We believe under-evaluation by the market has been key to GLPI’s record of 100 percent rent collections.” said the analyst in a note.

GLPI’s competitors are MGM Growth Properties (NYSE: MGP) and VICI Properties (NYSE: VICI).

GLPI Stock Steady Idea in Steady Group

The first wave of the Corona Virus in the United States punished the gaming REITs. Their operator tenants were alongside them. Investors were nervous about rent collection and the fear of foreclosures.

Names such as GLPI proved strong. Not only among gaming stocks but relative to the broader universe of real estate stocks they performed well. The pandemic affected the hotel, mall, and office. REITs delivered leading rent collection even as tenants encountered shutdowns across the country.

Finally, foreclosure fears proved unfounded. It helped GLPI stock to gain 55 percent over the past year. It was far ahead of the 31.51 percent returned by the MSCI US Investable Market Real Estate 25/50 Index.

St. Juste, the Mizuho analyst, said that GLPI and its fellows are winners in the recovery of the US economy. As the consumer is spending, the gaming income will grow.

GLPI owns the assets of 48 gaming venues across 16 states. Its largest tenant is Penn National Gaming (NASDAQ: PENN). It also leases properties to some smaller contractors as well.

GLPI has a lower-risk portfolio of assets. Executives had said that the priority for regional gaming real estate is because to avoid volatility. The risk is more with Las Vegas and other destination markets.

Currently, the REIT owns just three venues in Southern Nevada. Earlier this year, GLPI management showed interest in that integrated resort. But many buyers lack the financial resources to make enough offers.