Bally’s Corp.’s credit profile has improved, according to a December 8 investor note by Truist Securities analyst Barry Jonas. The latter maintained a Buy rating and $60 per share on the stock, which was trading at $41.89 apiece at the time.
Jonas opined that Bally’s enlargement of its term-loan capacity to $1.1 billion “seemingly enabled” the sale and leaseback of Twin River Lincoln, hopefully in the first quarter of 2026. Jonas allowed that “concerns remain” surrounding Bally’s credit profile, but that he likes Gaming & Leisure Properties’ potential setup. The latter, he wrote, would have a strong four-walled position at the Rhode Island casino, with “likely alternative operator interest if needed.”
Bally’s, Jonas continued, was now “in better graces with lenders.” A trio of Aries Management, King Street Capital Management, and TPG Credit extended $600 million in initial term loans, plus another $500 million in delayed-draw loans, subsequent to Bally’s having appeared to secure a New York State casino license.
Jonas reminded investors that GLPI had pushed the redemption of its option on Twin River Lincoln into 2028. However, that might prove unnecessary, he wrote, since “today’s announcement suggests any lender pushback on the Twin River sale leaseback has been overcome.”
Should events continue as Jonas expected, GLPI will purchase Twin River for $750 million, at an initial rent of $58.8 million per year. It will be an all-debt purchase to obtain tax advantages. The analyst added that Twin River’s gambling revenue rose three percent in the third quarter of this year.
The Twin River deal would bring GLPI’s net leverage to 4.4 times cash flow. The real estate investment trust’s stated comfort level with leverage is between five 5.5 times cash flow, according to Jonas.
Proceeds from the Twin River sale may be dedicated by Bally’s to covering the New York State licensing fee, which may run as high as $500 million.
As for the projected Bally’s Las Vegas, Jonas noted that GLPI is still committed to $175 million in infrastructural improvements to the site, formerly occupied by the Tropicana Las Vegas. However, “We believe GLPI has no interest for wider Tropicana funding at this time.”