New York Could Be the Solution to Bally’s Financial Troubles

Bally’s Corp. recently warned investors that it might not be able to continue as a going concern due to its mounting debt. This news sent the company’s stock price plummeting and cast doubt on many of its ongoing projects. However, Bally’s remains optimistic that it can overcome these challenges. Some analysts agree, highlighting the operator’s New York project as especially promising. The Bronx Development Shows Substantial Promise With recent news that Bally’s is struggling to repay its massive debt and revenues remaining negative, some have cast doubt on the company’s ability to continue financing its projects. For example, the gambling giant has paused construction on the hotel tower and surrounding amenities envisioned in its planned Chicago casino complex. However, some experts have not been so quick to dismiss Bally’s expansion plans. According to Truist Securities analyst Barry Jonas, New York could present unique opportunities that may help the company regain its footing. Bally’s has already poured roughly $800 million into the Bronx project and needs at least $500 million more to complete it. Despite its high cost, the project does show promise. According to Jonas, the development should find suitable investors fairly easily. Bally’s has also reiterated its plan to meet its projected 2030 opening date. Once the project secures the necessary financing and construction begins, it should be enough to stabilize shareholder confidence. The Company Remains in Hot Water Bally’s has other plans to deal with its financial difficulties. The company expects improved profitability in key jurisdictions thanks to prior investments. Furthermore, asset monetization, equity sales, and new debt should help provide the necessary liquidity to maintain operations. The available $488 million in cash and equivalents can provide another buffer. While Bally’s is not without options, Jonas acknowledged that the company remains in a rough spot. He reduced his price target for the company from $15 to $10, in line with the plummeting share price. However, Jonas rated the stock as Hold, preferring to wait for more developments before taking a more definitive stance. The following few quarters could prove pivotal for Bally’s future. If the company secures the necessary investments for its Bronx development, it may manage to stabilize its position. However, reaching profitability could prove especially challenging under these conditions. If key projects such as the one in Chicago fail, the company’s future could become increasingly uncertain.