Author Topic: TNA - Evergreen Gaming  (Read 13966 times)

Foreign Tuffett

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Re: TNA - Evergreen Gaming
« Reply #20 on: March 11, 2019, 07:21:58 AM »
First of all, congrats to lessthaniv on what looks to have been a pretty epic trade for him.

I finally got around to looking into this. I was close to pulling the trigger, but then I stumbled across the following, which I am just going to copy-and-paste from my notes:

* $400M new Emerald Queen tribal casino is scheduled to open in 12/2019. It is only ~10 minutes away from TNA's two Lakewood, WA properties (which are literally right next door to each other)

* Tribal casinos in Washington state have significant structural advantages over card rooms. Tribal casinos (1) operate under a more favorable tax regime (2) can offer slot machines, dice games, and roulette, and (3) allow gamblers to smoke

I suspect this is why management (apparently) wants to sell the company: two of their four properties are less than 1 year away from having a vastly superior property, operating under a looser regulatory regime, set up shop literally right down the street.




lessthaniv

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Re: TNA - Evergreen Gaming
« Reply #21 on: May 01, 2019, 07:54:56 AM »
Maverick who bought Nevada’s casinos, just bought Great Canadian’s Washington casino’s. They have been in the press suggesting they want to be regionally dominant and to expect more transactions. They paid more than 8.5x EBITDA for GC’S three properties. Evergreens have higher revenue and EBITDA. Financials are out as of last night on TNA.... 

From Stockhouse: Now that financials are out it is easier to compare the valuation to the recent Great Canadian sale. GC's 2018 revenue and EBITDA in USD was $31.7 and $6.3 million respectively. Evergreen just posted $39.4 and $8.3  for their 4 casinos. So Evergreen's revenue and EBITDA were 24% and 32% higher. Using GC's valuation, based on revenue Evergreen should fetch USD $69 million and $74 if using EBITDA. This is a range of 75-80 cents/share. And it doesn't take into account Evergreen's net cash and real estate holdings.

Stocks at $.46/sh
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Foreign Tuffett

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Re: TNA - Evergreen Gaming
« Reply #22 on: May 01, 2019, 01:09:13 PM »
Maverick who bought Nevada’s casinos, just bought Great Canadian’s Washington casino’s. They have been in the press suggesting they want to be regionally dominant and to expect more transactions. They paid more than 8.5x EBITDA for GC’S three properties. Evergreens have higher revenue and EBITDA. Financials are out as of last night on TNA.... 

From Stockhouse: Now that financials are out it is easier to compare the valuation to the recent Great Canadian sale. GC's 2018 revenue and EBITDA in USD was $31.7 and $6.3 million respectively. Evergreen just posted $39.4 and $8.3  for their 4 casinos. So Evergreen's revenue and EBITDA were 24% and 32% higher. Using GC's valuation, based on revenue Evergreen should fetch USD $69 million and $74 if using EBITDA. This is a range of 75-80 cents/share. And it doesn't take into account Evergreen's net cash and real estate holdings.

Stocks at $.46/sh

Very interesting. Any thoughts on my post immediately above?

lessthaniv

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Re: TNA - Evergreen Gaming
« Reply #23 on: May 01, 2019, 02:32:40 PM »
Yes, I think it's a fair concern and one I've mentioned in my previous notes (see above). Tribal casino's own the space overall for all the reasons you cite.

There are 29 federally recognized tribes in Washington State and all 29 of those have Class III gaming compacts.  Twenty-one tribes operate 28 casinos under compact already.

So, the fact is that Evergreen has operated and competed for a long time against tribal casino's. My feeling is that patrons of cardrooms are not necessarily looking for a large casino experience. They go to the small regional cardrooms because they don't want the big casino feel.

https://www.cdcgamingreports.com/maverick-gaming-acquires-three-small-casinos-in-the-seattle-area/

Excerpt:

Maverick Gaming previously announced in September 2018 a definitive purchase agreement to acquire Nevada Gold & Casinos, Inc., whose portfolio includes nine card rooms in Washington with seven in the greater Seattle area. Combined with the Great American purchase, Maverick will have 12 properties in Washington, with approximately 165 table games. The Nevada Gold transaction is pending the approval of the Washington State Gambling Commission and is anticipated to close in the first half of 2019.

We couldn’t be more excited to continue to expand our operation into Washington,” Pearson said in a statement.  “With a metro population of over 4.6 million people, coupled with a strong economy, Maverick has made a strategic decision to place full attention to this market. This is one of several transactions Maverick will be announcing over the next few months, which will continue to transform Maverick Gaming into a true regional operator.”

« Last Edit: May 01, 2019, 02:37:45 PM by lessthaniv »
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deleuze68

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Re: TNA - Evergreen Gaming
« Reply #24 on: November 22, 2019, 03:25:37 PM »
Ok, Evergreen continues to print money. Another fine quarter with earnings of USD $1.36 million or CAD 1.5 cents/share

They are now sitting on CAD 14 cents/share in working capital (all cash). The only debt is mortgages which are easily covered by their land holdings.

I don't know what is holding up the sale to Maverick but it must be immenent. The stock is just way too cheap trading at 4x TTM EV/EBITDA. Just for reference Maverick has been buying up Washington State casinos in the range of 8-9x EV/EBITDA. This would price Evergreen shares at around 70 cents/share or a 77% premium to today's closing price.
 

lessthaniv

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Re: TNA - Evergreen Gaming
« Reply #25 on: December 10, 2019, 05:48:37 PM »
Hi Deleuze68,

Yes, I agree with you. Not sure what the status is but it would make sense that if you’re going to make a move into Washington you’d want some of the premier assets there. In the mean time this little business just continues to produce free cash flow.

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