Great Canadian Gaming Corp (TSX:GC) has been on a sharp decline since the company released its earnings earlier this month. Despite seeing its sales rise by 126% year over year and profits nearly quadrupling, the stock has dropped from over $55 a share before the release to below $50 as of Wednesday’s close.
The stock was trading close to its 52-week high and if it’s able to recover back to that level that would be a 13% return from where it is today. While there’s no guarantee it’ll get climb back to those highs, I’d be surprised if there isn’t a recovery given this surprising decline.
After all, Great Canadian has shown significant growth in recent years as it has been adding more casinos into its portfolio, giving investors lots of hope for the future. In just three years, the stock has risen by more than 180% and has been one of the best growth stocks on the TSX.
Casinos are a big draw whether the economy is doing well or not, and this stock could be a good option for investors to diversify their long-term holdings. There aren’t many good gaming stocks out there and Great Canadian is among the very best. At a price-to-earnings multiple of around 21, the stock is a very good value given the growth that it has achieved recently.
With a good price and a lot of opportunities still ahead of itself, Great Canadian looks to be a good buy today. While investors might be willing to wait out more of a decline before buying, I wouldn’t expect the stock to fall much lower given how strong its last quarter was.
