NEW YORK (TheStreet) -- With "the fight of the century" over the weekend, and MGM Resorts International  (MGM) reporting earnings yesterday, and Caesar's Entertainment (CZR) reporting tomorrow, we decided to check TheStreet Ratings to find good casino stocks to invest in.

Part of the reason casinos have been struggling is due to the economy. Many folks haven't had much disposable income and, therefore, they have been less willing to "let it ride." As the recovery continues and people have some extra cash to burn, some of them are hitting the gaming tables.

Even with Atlantic City recently flirting with bankruptcy, there are still some casinos investors can gamble on that have better odds than the roulette table.

So what are the best casinos investors should be buying? Here are the top three, according to TheStreet Ratings, TheStreet's proprietary ratings tool.

TheStreet Ratings projects a stock's total return potential over a 12-month period including both price appreciation and dividends. Based on 32 major data points, TheStreet Ratings uses a quantitative approach to rating over 4,300 stocks to predict return potential for the next year. The model is both objective, using elements such as volatility of past operating revenues, financial strength, and company cash flows, and subjective, including expected equities market returns, future interest rates, implied industry outlook and forecasted company earnings.

Buying an S&P 500 stock that TheStreet Ratings rated a "buy" yielded a 16.56% return in 2014 beating the S&P 500 Total Return Index by 304 basis points. Buying a Russell 2000 stock that TheStreet Ratings rated a "buy" yielded a 9.5% return in 2014, beating the Russell 2000 index, including dividends reinvested, by 460 basis points last year.

Check out which three casinos made the list. And when you're done be sure to read about which mid-cap oil companies to sell now. Year-to-date returns are based on May 4, 2015 closing prices. The highest-rated stock appears last -- read more to see which one is No. 1.

 

MCRI ChartMCRI data by YCharts
3. Monarch Casino & Resort, Inc. (MCRI)

Rating: Buy, B
Market Cap: $316.8 million
Year-to-date return: 13.5%

Monarch Casino & Resort, Inc., through its subsidiaries, owns and operates the Atlantis Casino Resort Spa, a hotel/casino facility in Reno, Nevada; and the Monarch Casino Black Hawk in Black Hawk, Colorado.

"We rate MONARCH CASINO & RESORT INC (MCRI) a BUY. This is driven by a number of strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance, reasonable valuation levels, increase in net income and growth in earnings per share. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The revenue growth came in higher than the industry average of 7.0%. Since the same quarter one year prior, revenues slightly increased by 3.6%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • Compared to where it was a year ago today, the stock is now trading at a higher level, reflecting both the market's overall trend during that period and the fact that the company's earnings growth has been robust. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Hotels, Restaurants & Leisure industry. The net income increased by 23.4% when compared to the same quarter one year prior, going from $3.28 million to $4.04 million.
  • MONARCH CASINO & RESORT INC has improved earnings per share by 26.3% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, MONARCH CASINO & RESORT INC reported lower earnings of $0.83 versus $1.07 in the prior year. This year, the market expects an improvement in earnings ($1.00 versus $0.83).
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CHDN ChartCHDN data by YCharts
2. Churchill Downs Inc. 
( CHDN)
Rating: Buy, B
Market Cap: $2.1 billion
Year-to-date return: 25.6%

Churchill Downs Incorporated provides pari-mutuel horseracing, online account wagering on horseracing, and casino gaming services. It operates in five segments: Racing, Casinos, TwinSpires, Big Fish Games, Inc., and Other Investments.

"We rate CHURCHILL DOWNS INC (CHDN) a BUY. This is driven by some important positives, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, good cash flow from operations and solid stock price performance. We feel these strengths outweigh the fact that the company has had sub par growth in net income."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • CHDN's very impressive revenue growth greatly exceeded the industry average of 7.0%. Since the same quarter one year prior, revenues leaped by 50.1%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • Net operating cash flow has significantly increased by 72.67% to $89.67 million when compared to the same quarter last year. In addition, CHURCHILL DOWNS INC has also vastly surpassed the industry average cash flow growth rate of -70.42%.
  • Compared to its closing price of one year ago, CHDN's share price has jumped by 35.68%, exceeding the performance of the broader market during that same time frame. Looking ahead, the stock's sharp rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry. We feel, however, that other strengths this company displays justify these higher price levels.
  • CHURCHILL DOWNS INC has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. The company has suffered a declining pattern of earnings per share over the past two years. However, we anticipate this trend to reverse over the coming year. During the past fiscal year, CHURCHILL DOWNS INC reported lower earnings of $2.56 versus $3.07 in the prior year. This year, the market expects an improvement in earnings ($3.98 versus $2.56).
  • Even though the current debt-to-equity ratio is 1.00, it is still below the industry average, suggesting that this level of debt is acceptable within the Hotels, Restaurants & Leisure industry. Even though the debt-to-equity ratio shows mixed results, the company's quick ratio of 0.43 is very low and demonstrates very weak liquidity.
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LVS ChartLVS data by YCharts
1. Las Vegas Sand Corporation (LVS)

Rating: Buy, B
Market Cap: $42.8 billion
Year-to-date return: -8%

Las Vegas Sands Corp. develops, owns, and operates integrated resorts in Asia and the United States. The company owns and operates The Venetian Macao Resort Hotel, Sands Cotai Central, the Four Seasons Hotel Macao, the Plaza Casino, and the Sands Macao in Macau, the People's Republic of China.

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • LVS, with its decline in revenue, underperformed when compared the industry average of 7.0%. Since the same quarter one year prior, revenues fell by 24.9%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • LAS VEGAS SANDS CORP's earnings per share declined by 32.6% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, LAS VEGAS SANDS CORP increased its bottom line by earning $3.51 versus $2.79 in the prior year. For the next year, the market is expecting a contraction of 22.8% in earnings ($2.71 versus $3.51).
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 33.18%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 32.63% compared to the year-earlier quarter. Looking ahead, the stock's sharp decline over the past year may have been what was needed in order to bring its value into alignment with its fundamentals and others in its industry.
  • The company, on the basis of change in net income from the same quarter one year ago, has underperformed when compared to that of the S&P 500 and the Hotels, Restaurants & Leisure industry average. The net income has significantly decreased by 34.0% when compared to the same quarter one year ago, falling from $776.19 million to $511.92 million.
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