Morgan Joseph Positive On Gaming Sector

Analysts at Morgan Joseph are positive on the gaming technology sector since they launched on the space in October 2008. “We believe our thesis still holds true and that sector fundamentals have not changed, only investor sentiment has,” the analysts mention. Nevada and New Jersey were the two hard hit gaming markets in the country

“Visitation appears to remain relatively flat y/y, but spend per visit is still down. Indeed, gaming revenue was down over 4% in February 2010. We expect similar declines throughout 2010 until we see meaningful improvement in unemployment, wage growth, and consumer sentiment. As such, we do not expect to see top-line growth from the casino operators in our coverage universe until a robust gaming revenue environment emerges,” the analysts add.

The analysts believe that investing in the regional casino operators sector would be beneficial due to the growth pipeline. “We believe Penn National Gaming (NASDAQ: PENN), Pinnacle Entertainment (NYSE: PNK), and Full House Resorts (AMEX: FLL) fit the bill,” the analysts say.

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