Wynn Resorts, Rush Street Lead Hot Summer for Gaming Stocks

August capped off a superb summer for the U.S. betting sector, with a number of gaming giants posting double-digit stock price rises for the month.

While Rush Street Interactive (NYSE:RSI), Wynn Resorts (NASDAQ:WYNN), and PENN Entertainment (NASDAQ:PENN) all saw stock price rises, the upward trajectory wasn’t felt across the board. In fact, while most U.S. gaming stocks gained ground, Light & Wonder (NASDAQ:LNW) and Churchill Downs Incorporated (NASDAQ:CHDN) managed to finish the month off in the red.

Here’s a quick look at the most notable gaming stocks in August:

Top performing U.S. gaming stocks

Rush Street Interactive, Inc. (RSI) +15.25%

Rush Street continued its meteoric ascent throughout August, reaching a new 52-week high of $22.52 per share, translating to a staggering 62.54% year-to-date (YTD) rise. 

RSI’s strong second-quarter earnings have certainly reinforced bullish sentiment towards the firm, whose earnings per share of $0.11 far exceeded initial analyst expectations. Headquartered in Chicago, the innovative gaming operators raised their full-year guidance, drawing a fresh “Buy” rating from Needham, further underlining investor confidence in the brand.

Wynn Resorts, Limited (WYNN) +15.23%

Wynn Resorts actually closed the month with its best run in years, receiving an additional boost following its major UBS upgrade, setting a target price of $147.

Clearly buoyed by a 47.11% YTD gain, its 10% revenue growth in Las Vegas, and the ongoing success of its wider operations in Macau, the company continues to pique the interest of investors. Given the additional buzz surrounding Wynn Al Marjan Island, its 1,500-room luxury resort in the UAE, the future remains promising for the Las Vegas-based firm.

PENN Entertainment, Inc. (PENN) +14.16%

PENN Entertainment is another gaming firm on the receiving end of a strong August performance following the announcement of its better-than-expected quarterly earnings.

The Pennsylvania-based gaming firm recently reported a 6.1% revenue increase and EPS of $0.10, evidently reassuring investors that the board has stabilized the ship following a turbulent 2024. In addition to this, institutional ownership of PENN remains at nearly 92%, underscoring Wall Street’s long-term confidence that it will continue to flourish into the fall.

U.S. gaming stocks on the slide

Light & Wonder, Inc. (LNW) -2.49%

Light & Wonder was undoubtedly the weakest gaming stock performer in August, witnessing a 2.5% decline as investors’ interest cooled, bucking the broader industry trend.

While the Las Vegas outfit saw earnings rise 19% over the past year, long-term growth appears to be inconsistent. Furthermore, trading at a P/E ratio of 22.6x, LNW’s stock is considered relatively pricey in comparison to its industry peers, raising concerns it may still be trading at a premium.

Churchill Downs Incorporated (CHDN) -1.95%

Churchill Downs’ stocks also struggled in August, having seen its share price slip nearly 2%, despite the firm announcing its $180 million acquisition of Casino Salem in New Hampshire.

Nevertheless, analysts remain cautiously optimistic, assigning a Buy rating and a $120 price target to the firm based out of Louisville, Kentucky.  That being said, its high leverage and modest recent stock performances may still see investors holding out for further signs of improvement.

Las Vegas Feels the Heat Over Declining Visitor Count

In direct contrast to the positive momentum gained by the industry as a whole, Las Vegas experienced its 6th consecutive drop in monthly visitors, according to the Las Vegas Convention & Visitors Authority (LVCVA). Two firms that both saw declining Vegas revenues in Q2 were Caesars and MGM, although convention numbers and high-profile entertainment acts are being touted to boost demand later this year.

Meanwhile, BetMGM – MGM’s online betting operation – launched its “Make it Legendary” rebrand, backed by Emmy-winning actor Jon Hamm, in a bid to strengthen its market share of the online betting segment. Believed to be timed to coincide with the start of the new NFL season, the campaign hopes to lure customers away from prominent sportsbooks, including DraftKings (NASDAQ: DKNG) and FanDuel (NYSE: FLUT).

Finally, Polymarket also announced its return to U.S. markets in August, following a three-year absence, pitching its sports event contracts as a legitimate alternative to online sports betting platforms. Armed with CFTC oversight, Polymarket hopes to capitalize on a nationwide user base of sports bettors, with ads conveniently timed ahead of the NFL kickoff this Thursday, September 4.