Market Overview

Short-Squeeze Could Be Triggered in Boyd Gaming After Peninsula Acquisition Announcement


Boyd Gaming (NYSE: BYD) announced on Thursday morning that it has entered into a definitive agreement to acquire Peninsula Gaming, LLC for total consideration of $1.45 billion. The acquisition will bolster Boyd's existing gaming portfolio with five new properties. These include the Kansas Star Casino near Wichita, Kansas; Diamond Jo Casino in Dubuque, Iowa; Diamond Jo Worth in Northwood, Iowa; Evangeline Downs Racetrack & Casino in Opelousas, Louisiana; and Amelia Belle Casino in Amelia, Louisiana.

The stock market is reacting favorably to the announcement from Boyd, and the stock was last trading up 6.45% to $7.43. While BYD shares are stuck in a downtrend, today's announcement could potentially catalyze a rebound in the stock. In recent trading sessions, as much as 22% of BYD's float had been sold short. If these short-sellers begin to cover their bearish bets en masse, it could potentially push BYD's share price higher in the near-term.

The stock is trading roughly 1.28% below its 20-day moving average and 4.58% below its 50-day moving average. If BYD can get above its 20-day and sustain this level, there could be more upside in the name. Over the last 3 months, BYD shares have fallen more than 22%, including roughly 8% over the last month. Given today's announcement and the stock's high short interest, today's announcement may trigger a retracement of some of these losses.

Posted-In: Long Ideas News Technicals M&A Intraday Update Movers Trading Ideas


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