Gaming and Leisure Properties Could Be Takeover Target, Says Research Firm

Gaming and Leisure Properties (NASDAQ:GLPI) could live a takeover point as consolidation increases within the existent landed estate sector.

That’s the ruling of Wide Moat Research CEO Brad Saint Thomas who highlights the gaming existent acres investment funds cartel (REIT) among several REITs that could be attractive to suitors.

Next upwardly on our list of potential takeover targets is Gaming and Leisure Properties,” says Thomas. “It’s an interesting gaming REIT that’s been actively gobbling up regional casinos.”

Spun away from William Penn National Gaming (NASDAQ:PENN) inwards 2013, GLPI pioneered gaming REITs as standalone in public traded companies. Today, the Pennsylvania-based companionship owns the existent acres assets of to a greater extent than 50 gaming venues crossways 17 states.

Interesting Points for GLPI Takeover Thesis

Thomas points to Realty Income’s (NYSE:O) pending $1.7 1000000000 purchase of Encore Hub of the Universe Harbor from Wynn Resorts (NASDAQ:WYNN) — announced shoemaker's last month — as grounds that more REITs that currently want gambling casino exposure could explore the space.

“More recently, Realty Income proclaimed it was entering the gaming blank by way of life of a sale-leaseback for Encore Boston Harbor. The price tag of $1.7 1000000000000 represents a 5.9% pileus rate, making for a great deal for O,” notes Thomas. “It also validates the gaming subsector’s appealingness and opens the doors for other net-lease REITs to ‘get inward the game.’”

There are examples of non-gaming REITs owning some gambling casino real estate. In increase to Realty Income purchasing Encore capital of Massachusetts Harbor, a existent land affiliate of private equity unshakable Blackstone (NYSE:BX) owns the holding of Bellagio on the Las Vegas Strip. That entity also holds minority interests inwards Mandalay Bay and MGM Grand.

GLPI’s market value is $11.2 billion, but it’s stock is inexpensive and it power non want for potency suitors, including the aforementioned Realty Income.

“GLPI trades at a chinchy multiple of 13.4 P/AFFO and offers a in high spirits equity pay of 7.5 percent,” adds Thomas. “There’s plenteousness of meat on the debone for a REIT similar Realty Income, STORE Capital, Spirit Realty, or regular National Retail Properties to lift out upwards some really chinchy casinos.”

GLPI Takeover Previously Pitched

This isn’t the first-class honours degree time GLPI has been mentioned as a possible takeover target.

In 2020, Jonathan Litt’s Din Land & Buildings Investment Management (L&B) pushed the REIT to merge with competitor Vici Properties (NYSE:VICI). That sell didn’t materialize.

Today, VICI is inward the midst of getting MGM Growth Properties (NYSE:MGP) — the other in public traded gaming REIT — for $17.2 one million million inward stock.

GLPI’s major tenants include William Penn National, Bally’s (NYSE:BALY), Boyd Gaming (NYSE:BYD) and Caesars Entertainment (NASDAQ:CZR).