About Red Rock Resorts
Red Rock Resorts, Inc., through its interest in Station Holdco and Station LLC, develops and operates casino and entertainment properties in the United States. It operates through two segments, Las Vegas Operations and Native American Management. The company owns and operates 9 gaming and entertainment facilities, and 10 smaller casinos in the Las Vegas regional market. In addition, it manages Graton Resort & Casino in northern California. As of December 31, 2021, it operated approximately 13,894 slot machines, 240 table games, and 3,081 hotel rooms in the Las Vegas market.
The company was formerly known as Station Casinos Corp. and changed its name to Red Rock Resorts, Inc. in January 2016. Red Rock Resorts, Inc. was incorporated in 1976 and is based in Las Vegas, Nevada.
RRR operates in the Retail Trade | Restaurants, Hotels, Motels | headquartered in LAS VEGAS, Nevada | approximately 7,850 employees | led by CEO Frank J. Fertitta.
The $6.4B question: What happens when a company this good becomes this expensive?
The American consumer has always been a fickle beast — spending freely in good times and retreating in bad. Red Rock Resorts, Inc. has spent decades learning to read those moods, and right now, the reading is surprisingly sanguine.
At $6.4B in market capitalization, Red Rock Resorts, Inc. (RRR) currently ranks #50 in our quantitative model, with a composite score of 78.9/100. That places it firmly in "Strong Buy" territory — our highest conviction rating.
But here's the thing about stocks priced for perfection: They leave no room for error.
The Numbers That Matter
Let's start with what's undeniably true. Our 6-factor model gives RRR the following scores:
| Factor | Score | Weight | Assessment |
|---|---|---|---|
| Quality | 95/100 | 30% | Exceptional |
| Value | 72/100 | 15% | Fair |
| Momentum | 84/100 | 25% | Accelerating |
| Investment | 77/100 | 10% | Growing |
| Stability | 35/100 | 10% | Volatile |
| Short Interest | 10/100 | 10% | High shorts |
The quality score of 95/100 is the headline here. It reflects profitability metrics that would make most CFOs weep with envy:
- ROE: 1.6%
- Net Margin: 16.2%
- Gross Margin: 62.2%
These aren't just good numbers. They're the kind of numbers that make RRR a "must-own" stock for institutional portfolios.
The Bull Case
"If you could design a business in a laboratory, it would look something like RRR."
The bull case writes itself:
- Quality is persistent. Academic research shows high-quality stocks outperform by 4-6% annually over long periods. RRR is quality defined.
- Momentum is real. With a momentum score of 84/100, the stock has been recognized by the market — and momentum tends to persist.
- The moat is deep. Companies with these margins don't lose them easily. The competitive position is entrenched.
The Bear Case
But here's what keeps value investors up at night:
- Valuation compression risk. At current levels, the stock is priced for continued perfection. Any stumble — a missed quarter, a competitive threat, a macro slowdown — could compress the multiple from 33.9x to the low 20s. That's a 20-30% decline without anything fundamentally "wrong."
- The crowded trade problem. When everyone owns a stock, who's left to buy? Momentum works until it doesn't.
- Mean reversion. Trees don't grow to the sky. At some point, growth decelerates.
The Valuation Framework
| Scenario | Assumption | Fair Value | Upside/Downside |
|---|---|---|---|
| Bear | Multiple compression to 20x | -20% | Downside |
| Base | Current trajectory continues | +10-15% | Modest upside |
| Bull | Momentum accelerates | +30-40% | Significant upside |
The risk-reward is ... fine. Not exceptional. Not terrible. Just fine.
The Bottom Line
Red Rock Resorts, Inc. is exactly what it appears to be: a high-quality business with strong momentum trading at a premium price. Whether that's attractive depends entirely on what kind of investor you are.
For long-term, buy-and-hold investors, RRR is a core holding. For value investors or short-term traders, look elsewhere.
The company is priced for perfection — and in markets, as in life, perfection is a fragile thing.
⭐⭐⭐⭐⭐ Rating: 5-Star Strong Buy
Score: 78.9/100 | Rank: #50 of 3,571 stocks
Sector: Consumer Discretionary
This analysis reflects the views of Blank Capital Research as of February 16, 2026. It is not investment advice. Past performance does not guarantee future results.