Morgan Stanley sees robust US gaming and lodging demand as consolidation wave builds

Morgan Stanley told its industry conference that US lodging and gaming demand is broadly improving — led by leisure and group bookings and an uptick in corporate travel — supporting a continued wave of consolidation in brick-and-mortar casinos and hotel owners. Analysts flagged AI as a developing operational factor (revenue management, distribution, labor) but said outcomes are uncertain. Valuations have risen yet remain below historical norms, and Morgan Stanley highlighted select hotel REITs (notably RHP) as well placed. Market impact: stronger sector fundamentals and a potentially narrowing M&A approval window could spur deal activity and lift share prices of hotel REITs and gaming operators, while uneven cost pressures (gas, rates, healthcare) temper near-term upside.