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Boyd Gaming Rises 5% on Acquisition Plans

Gaming and hospitality company Boyd Gaming Corporation (NYSE: BYD) recently revealed that its subsidiary Boyd Interactive Gaming has entered into an agreement to acquire an online gaming technology company, Pala Interactive, for $170 million. The deal is likely to close in the first quarter of 2023.

Following the news, shares of the company rose almost 5% to close at $71 in Monday’s extended trading session.

Strategic Impact

The impending acquisition of Pala Interactive is aimed at strengthening Boyd’s iGaming strategy. With business-to-business (B2B) services in eight states and business-to-consumer (B2C) services in two states, Pala’s technology includes its player account management system, casino, poker, and social casino and poker platforms.

Management Commentary

The CEO of Boyd Gaming, Keith Smith, said, “The acquisition of Pala Interactive marks the next phase in the ongoing execution of our iGaming strategy, providing us full control over the technology, development and customer experience. By integrating online casinos with our existing land-based operations, we will be able to further leverage and monetize our expansive customer database and the amenities of our nationwide portfolio of properties, driving growth in both our land-based and iGaming operations.”

Stock Rating

The Wall Street community is cautiously optimistic about the stock and has a Moderate Buy consensus rating based on five Buys and two Holds. BYD’s average price target of $81.43 implies that the stock has upside potential of 20.4% from current levels. Shares have gained 18.9% over the past year.

Insider Trading Activity

TipRanks’ Insider Trading Activity tool shows that confidence in Boyd Gaming is currently Negative based on informative transactions by two insiders over the past three months. Corporate Insiders have sold shares worth $1.2 million over this period.

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