"Fifth Worst Economy" Could Frighten Investors From Certain Gaming Stocks
03 Dezembro 2010 - 2:25PM
Marketwired
Several gaming stocks have posted impressive gains this year as
surreal revenue growth in Macau boosted investor confidence in the
industry. Confidence in the Las Vegas market remains mixed at best,
however. While casino operators sound confident that the market in
Vegas has finally reached its bottom, Las Vegas' unemployment rate
tells a different story. In fact, a recent study from the London
School of Economics ranked Las Vegas' economy fifth from the bottom
in a ranking of 150 metropolitan areas, citing a limited economy
that relies heavily on tourism and construction. Over the last
three years, much of the local economic downturn can be tied to the
gambling industry, which has seen sharply declining revenues. The
question must arise: just how much more can these gaming stocks
rise without Las Vegas -- or the United States for that matter --
showing significant improvement in employment rates? The Bedford
Report examines the outlook for companies in the Resorts and
Casinos Industry and provides research reports on MGM Resorts
International (NYSE: MGM) and Melco Crown Entertainment Ltd.
(NASDAQ: MPEL). Access to the full company reports can be found at:
www.bedfordreport.com/2010-12-MGM
www.bedfordreport.com/2010-12-MPEL
MGM has operations in Nevada, Mississippi and Michigan, and has
certainly felt its top line pinched during the US employment
crisis. For the third quarter, American Gaming Association head
Frank Fahrenkopf said gambling revenue in state-licensed casinos
rose 1.3 percent sequentially, but was down close to $100 million
year-on-year. According to the state's department of revenue,
revenues in Mississippi are down over 3 percent this year.
The Bedford Report releases regular market updates on the
Resorts and Casinos Industry so investors can stay ahead of the
crowd and make the best investment decisions to maximize their
returns. Take a few minutes to register with us for free at
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One hundred percent of Melco Crown's revenue is derived from
Macau. The holding company operates the Mocha Club and Crown Macau
gaming interests in Macau and is developing the City of Dreams
casino and resort complex. According to the Macau Gaming Inspection
and Coordination Bureau, Macau's casino revenues rose nearly 42
percent year-on-year to a staggering $2.13 billion in November.
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