Is Gaming and Leisure Properties a Buy?
Real estate investment trust (REIT) Gaming and Leisure Properties (NASDAQ: GLPI) isn't your typical landlord, which can be both a positive and a negative today. COVID-19 has been a particular worry among investors, pushing shares lower by nearly 20% so far in 2020 and down roughly 30% from their peak prior to the coronavirus' spread across the world. With a yield of around 7%, is this REIT a buy? Here are some important things to consider before you make the final call.
Gaming and Leisure Properties is a real estate investment trust that owns casinos. These are large structures that would be difficult to repurpose. There are only so many casinos available to be purchased and there are a number of REITs looking to buy them, so competition is an issue. There's also a limited number of casino operators to which one can lease a property in the space. Moreover, gambling is a highly regulated business that is cyclical in nature. Although the expression that the house always wins is very true, that doesn't mean the house will be profitable, because it still has a lot of other costs to cover with its gambling gains.
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Source Fool.com
