Market decline

VICI stock attracts significant investment during market downturn

During the first quarter of 2022, Point72 Asset Management, a hedge fund led by Mets owner Steve Cohen, purchased 633,800 shares of VICI Properties. This comes amid a falling market and is likely Cohen’s attempt to adopt a more defensive strategy.

Cohen plays it safe with low-risk purchases

It feels like a departure from the norm for the 65-year-old hedge fund manager, who has earned a reputation for making big, risky bets on volatile stocks. Cohen is also betting it safe on BP, as he bought an additional 3,276,969 shares of the world’s largest oil and gas producer, bringing the total value of his stake in the company to $122 million. These moves seem to be paying off as VICI and BP shares are currently up.

Steve Cohen, who has an estimated net worth of $11.9 billion, maintains a portfolio containing nearly 1,500 investments, many of which are in the gaming industry. The hedge fund’s investment in VICI was valued at 18, $03 million at the end of the first quarter of 2022. Point72 has recently focused on defensive stocks with dividend yields above 10-year Treasury yields, and VICI fits those requirements perfectly.

Cohen isn’t the only REIT casino fan. JPMorgan analyst Anthony Paolone expressed his positive view of the stock, writing:

“We believe VICI has strong earnings visibility post-closing of the MGP deal and the Venetian transaction…We believe that the company’s free cash flow reinvestment alone – when combined to contractual increases – should lead to net profit growth of around 4% indicate; and we believe it has a significant addressable market that should grow beyond that.

JPMorgan Analyst Antoine Paolo

VICI has a lot of growth potential

VICI is currently the largest casino REIT (Gaming Real Estate Investment Trust) and the largest landlord on the Strip following its $17.2 billion acquisition from MGM Growth Properties. The deal increased VICI’s annual rents collected by more than $1 billion. VICI now owns 10 resorts in Las Vegas and its portfolio includes 43 casinos, 450 restaurants, several bars and clubs, as well as four major golf courses.