There’s no other gaming and entertainment stock that charms long-term financial planners than Great Canadian Gaming (TSX:GC). Canada’s largest gaming operator has been around since 1982, and betting on the stock is no gamble. This year, the company expect tonnes of cash, which investors can partake of.
To be successful in the gaming industry, a company should have the expertise to build scale. That is the greatest strength of Great Canadian Gaming that is the envy of rivals. The company made some masterful strokes to build scale that resulted in streamlined operations and a reduction in operating costs.
The influence of Great Canadian Gaming is easily felt in Canada. All 28 properties the company is currently operating are cash cows. And there’s hardly a dearth of casino patrons. Casino Woodbine in Ontario and River Rock Casino Resort in B.C. are among the prominent casinos.
If it’s scaling you’re talking about, the company can readily upgrade the existing facilities. There are plenty of available spaces to fill and add new slots and tables. More cash is expected to pile up in the Greater Toronto Area (GTA). The gaming assets acquired there are already raking in billions of dollars in revenue
Top stock performer
The shares of Great Canadian Gaming handily beat the S&P/TSX Composite Index. The total return generated last year was 42%, which makes it one of 2018’s stellar stock performers. January is almost over, and going by the look of things, Great Canadian Gaming will again be in the radar of value-seeking investors.
The previous quarter’s market disruption did little damage to this leisure stock, although it ended the year below $50. As of this writing, the current price is higher at $52.30, and at this level it would be the perfect time to buy. Breaching the $60 threshold is not remote when the new projects go upstream.
Transforming the gaming landscape
The track record of Great Canadian Gaming speaks for itself. Investors should focus on three major factors why this leisure stock is worth buying. First, current and new players couldn’t compete where Great Canadian Gaming is present. And that is almost everywhere.
Next is Great Canadian Gaming’s modernization and development plan, which includes, among others, integrating and expanding the properties. Apart from the casinos, there will be new hotels, entertainment venues, meeting, and event places rising. The end view is to enhance the guest experience.
Finally, Chief Executive Rod Baker himself has sunk in $80 million of his personal funds to the company. The company owns the exclusive right to operate the gaming facilities in the so-called GTA bundle. The locked-in agreement is good for 22 years at the minimum.
Hence, people preparing for the sunset years should include Great Canadian Gaming in their retirement portfolios. Remember that you’re not in the casino throwing a dice. You’re thinking ahead and looking forward to a financially healthy retirement lifestyle.
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Fool contributor Christopher Liew has no position in any of the stocks mentioned.