Shares of Las Vegas–based casinos surge after NFL green-lights Oakland Raiders’ move to Vegas

Nevada has approved $750 million in public money to build a new stadium in Las Vegas for the franchise, with another $650 million coming from Bank of America Corp. BAC, +2.28% after initial backer Sheldon Adelson, chief executive and chairman of Las Vegas Sands Corp. LVS, +0.69% , departed the project.

The Raiders are seeking to build a 65,000-seat stadium, and the team itself is contributing $500 million, according to UBS analysts. The move, it is hoped, will draw a new base of football fans to the gambling mecca, boosting attendance at casinos.

Wynn Resorts Ltd. WYNN, +0.74% Chief Executive Steve Wynn told the Wall Street Journal that the move is a game changer for Vegas: “You can talk about all the acts that come to Las Vegas and all the concerts, but they don’t get televised to tens of millions of people,” he told the paper in a Monday interview.

MGM Resorts International MGM, +2.11% led the gainers with a 1% rise, and it’s now up 4.5% this week. Las Vegas Sands shares were up 0.8% for a 2.6% gain since the Monday open. Wynn Resorts was up 0.1% for a 2.5% gain on the week. Melco Crown Entertainment Ltd. MPEL, -3.05% bucked the trend to trade down 2.2%.

Other casino stocks were also higher, with Boyd Gaming Corp. BYD, +0.80% up 0.3%, Isle of Capri Casinos Inc. ISLE, +1.92% up 0.6%, Penn National Gaming Inc. PENN, +0.76% up 0.6% and Pinnacle Entertainment Inc. PNK, +1.09% up 0.7%.

Analysts at Macquarie said speakers at a consumer conference it hosted last week confirmed a healthy end market for the Las Vegas Strip, with high-end consumers driving growth. MGM Chief Financial Officer Dan D’Ariggo said Las Vegas earnings before interest, taxes, depreciation and amortisation (EBITDA) margins rose to 30% in 2016 from 24% in 2014 and said another increase of about 31% seems attainable in 2017, according to Macquarie.

“Despite recent share-price weakness, the underlying Las Vegas end market remains just as healthy as it was a quarter ago and should continue to benefit as the largest convention market in the country,” analysts wrote in a note.

The PowerShares Dynamic Leisure & Entertainment Portfolio exchange-traded fund PEJ, +1.21% was up 0.3% and has gained 1.3% so far in 2017. The S&P 500 SPX, +0.84% has gained 4.7% in the same time period.