VICI | Q4 2024

The content provided on this website, including any communications, posts, videos, social media interactions, and other materials, is for informational and educational purposes only. It should not be considered as financial or investment advice. Read our full disclaimer here.

Links

• Link to Transcript

• Link to 10-K

Overview

• Revenue of $976.05M (+4.7% Y/Y) beats by $6.76M.

• FFO of $0.58 misses by $0.09.

Takeaways

VICI Properties (VICI) closed out 2024 with solid financial results, highlighted by steady growth in adjusted funds from operations (AFFO) and a strengthened balance sheet.

AFFO per share came in at $0.57 for the quarter, marking a 3.6% increase from the same period last year, while full-year AFFO per share reached $2.26, up 5.1% year-over-year. Looking ahead, VICI is projecting 2025 AFFO per share to land between $2.32 and $2.35, implying another year of decent but stable growth.

The company also successfully refinanced its debt, securing a $2.5 billion credit facility and improving its investment-grade standing across all three major rating agencies, including a long-awaited upgrade from Moody’s.

With total liquidity of $3.3 billion and a net debt-to-EBITDA ratio of 5.3x, VICI enters 2025 in a strong financial position.

One of the most notable developments from the quarter was VICI’s newly established strategic relationship with Cain International and Eldridge Industries, starting with an investment in the One Beverly Hills project.

CEO Ed Pitoniak emphasized that this partnership aligns with VICI’s long-term vision of investing in differentiated, experience-driven properties. One Beverly Hills, set on 17.5 prime acres in Beverly Hills, will feature an Aman-branded luxury hotel, spa, and residential towers, as well as a fully renovated Beverly Hilton and a high-end retail and dining district.

Pitoniak hinted that this initial investment could evolve into a broader relationship with Cain and Eldridge, potentially leading to further experiential real estate investments.

VICI continued its aggressive capital deployment in 2024, committing $1.1 billion at an 8.1% initial yield, with investments spanning from Las Vegas resorts to family entertainment venues.

Las Vegas tourism remains a bright spot, with 42 million visitors in 2024 and record airline traffic through Harry Reid Airport.

The company’s operating partners are doubling down on reinvestment as well—MGM Grand is undergoing a $300 million renovation, Caesars New Orleans just completed a $435 million overhaul, and Harvey’s Lake Tahoe is in the middle of a $100 million transformation.

Altogether, operators have committed nearly $1 billion in upgrades to VICI-owned properties, underscoring the strong demand for high-quality hospitality and entertainment experiences.

On the balance sheet side, CFO David Kieske reflected on how VICI has evolved from an unconventional, highly leveraged REIT at its inception to a blue-chip, investment-grade company today.

The final milestone in this transformation came in November 2024, when Moody’s upgraded VICI’s credit rating, joining S&P and Fitch in giving the company investment-grade status. This upgrade is expected to lower borrowing costs and improve access to capital going forward.

During the Q&A session, Pitoniak addressed a question about how VICI balances development funding versus acquisitions and whether the company prioritizes recurring income.

He explained that VICI’s long-term relationships with developers like Cain and Eldridge, as well as Great Wolf, create opportunities to continuously reinvest capital into new projects, rather than simply waiting for loans to be repaid.

He hinted that VICI may look to expand its role in One Beverly Hills and potentially fund future Aman-branded developments in Europe, similar to its ongoing partnership with Great Wolf Resorts.

Overall, VICI is proving that investing in high-quality, experience-driven real estate—whether through casinos, luxury hotels, or entertainment venues—continues to pay off. I’ve added quite a bit of shares in recent months, and even at its current price in the low $30s, will slowly continue building out my position.

---