Red Rock Resorts Inc - Class A

Red Rock Resorts delivered a stronger-than-expected bottom line in the third quarter of 2023, with diluted EPS of $0.60 coming in 25.00% above the $0.48 consensus estimate, even as the company navigated modest top-line softness and a meaningful rise in interest expense. Net revenues slipped 0.7% year over year to $411.61 million, barely edging past the $411.36 million consensus. The primary drag on the quarter was casino revenue, which declined to $272.75 million from $282.39 million a year earlier, though non-gaming categories provided a partial offset, with food and beverage, room, and other revenues each posting year-over-year gains. A sharply higher interest expense burden of $45.50 million, up roughly $11.20 million from the prior-year period, weighed on net income, which fell 28.3% to $68.42 million. Adding to the cautious tone, the company's highly anticipated $780 million Durango Casino and Resort, a key near-term growth catalyst, saw its opening pushed back to December 5 as portions of the property required additional time to complete.