Golden Entertainment Boosts Buyback Program
The operator of The Strat casino hotel near the Las Vegas Strip, Golden Entertainment, is increasing its share buyback program.
Las Vegas at night. Golden Entertainment Las Vegas buyback program.
LISTEN TO THIS ARTICLE:With the release of third-quarter earnings, Golden’s board of directors approved an extra $100 million as part of the current repurchase plan, bringing the total to $131.4 million.
We anticipate that business conditions will improve in the fourth quarter, and with our increased share buyback authorization currently at over $130 million, we expect to continue to use our liquidity to acquire our own shares throughout the year.
This isn’t the first time Golden Entertainment has boosted buyback programs. It did so in July 2023, too.
Golden’s Made Good on Buyback Promises
Repurchase programs allow shareholders to get some money back and are also tax-efficient.
The owner of The Strat Las Vegas is making good on its promise to buyback any shares because they see value in that stock. However, it’s down 22.92% year-to-date.
In the third quarter, Golden Entertainment bought back 815,116 shares for $31.65 each ($25.8 million). Throughout October, it was another 134,613 shares.
This year, Golden Entertainment has repurchased 1.94 million shares for an average of $30.70, close to $60 million. The $30.70 price is just below today’s closing value of $30.78.
Related: Golden Entertainment Eye's Potential Mergers and Acquisitions
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A Quick Glance at Golden’s Financials
While the stock is down, Golden Entertainment’s balance sheet is, by all accounts, still in good shape. It owns a large amount of real estate where gaming venues are located.
At the end of the third quarter, it had $68.6 million in cash and equivalents and could borrow up to $240 million.
Golden does have $399 in outstanding liabilities but this could be brought down should earnings increase with some help from lower interest rates.
There have also been rumors of Golden Entertainment selling a casino and leasing it back, though that’s not confirmed. If that happened, Golen would help in the cash department but would then need to pay rent.
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