Wednesday, December 20, 2006

The Winnings and Losses of Gambling Stocks

Today, Wednesday December 20, a buyout offer was approved by Harrah's Entertainment (HET on the NYSE) with the stock ending up slightly, but up around 23% for the last three months. Yet, on the same day, Trump Entertainment Resorts Inc. (TRMP on NASDAQ) was down over 13% just for the day, due to its loss on its bid for a Pennsylvania license. As you can see, the gambling stocks (or ‘gaming stocks’ as the ‘politically correct’ reference that the companies prefer to be called) can be extremely volatile, yet very profitable opportunities abound. There are rumors on the street of additional gambling (I mean gaming) stock takeovers. (By the way, the reason I don’t like to refer to these stocks as ‘gaming stocks’ is because I consider Electronic Arts (ERTS) and Activision (ATVI), companies which make electronic games, as gaming stocks.)
Where do you begin to look for potential takeover stocks in the casino field? Here is a list of some of the major players in the field along with a guide to where they do business.

Ameristar (ASCA NASDAQ) Owns casinos in Missouri, Iowa, Mississippi, Louisiana, Colorado, and Nevada. Emphasizes signature restaurant concepts including steakhouses and big buffets.

Aztar Corp. (AZR NYSE) Owns casinos in New Jersey, Nevada, Missouri, and Indiana, including riverboat casinos.

Boyd Gaming Corp. (BYD NYSE) Owns casinos in Nevada, New Jersey, Mississippi, Illinois, Indiana, and Louisiana.

Harrah's Entertainment Inc. (HET NYSE) Just agreed to be taken over by Texas Pacific Group and Apollo Management L.P.

IGT (IGT NYSE) Manufactures and sells gambling machines, including slot machines, wide area progressive jackpot systems, video lottery terminals, and video bingo machines.

Isle of Capri (ISLE NASDAQ) Owns casinos in Mississippi, Louisiana, Iowa, Missouri, Colorado, Bahamas, and England.

Las Vegas Sands Corp. (LVS NYSE) Owns and develops casinos in Las Vegas, Nevada and Macao, which is part of the People’s Republic of China.

MGM Mirage (MGM NYSE) Owns a lot of the ‘famous’ Las Vegas casinos and hotels including Bellagio, MGM Grand Las Vegas, Mandalay Bay, The Mirage, Luxor, TI, New York-New York, Excalibur, Monte Carlo, Circus Circus Las Vegas, Slots-A-Fun, and Boardwalk. It also owns casinos in Michigan, Mississippi New Jersey, and Illinois.

Penn National Gaming Inc. (PENN NASDAQ) Owns casinos (and some racetracks) in Colorado, Illinois, Indiana, Iowa, Louisiana, Maine, Mississippi, Missouri, New Jersey, Ohio, Pennsylvania, West Virginia, and Ontario, Canada.

Pinnacle Entertainment Inc. (PNK NYSE) This was the original Hollywood Park Turf Club that was founded in 1935. They own casinos in Indiana, Nevada, Louisiana, Missouri, California, Argentina, and the Bahamas.

Scientific Games (SGMS NASDAQ) Offers products and services to the lottery and pari-mutuel wagering industries. They also operate pari-mutuel wagering in Connecticut, Maine; and the Netherlands.

Station Casinos (STN NYSE) Owns several smaller hotels and casinos in the Las Vegas area.

Trump Entertainment Resorts Inc. (TRMP NASDAQ) Owns and operates Trump Taj Mahal Casino Resort, Trump Plaza Hotel and Casino, and Trump Marina Hotel Casino in New Jersey.

WMS Industries Inc. (WMS NYSE) Manufactures and sells gaming machines and video lottery terminals.

Wynn Resorts Ltd. (WYNN NASDAQ) Owns and operates the Wynn Las Vegas casino in Nevada and the Wynn Macau, in Macau, China.

The author owns shares in LVS and TRMP.


StickyManSam said...

I found this to be a really interesting blog on internet casino slot. Some very good points made there. Would be helpful to have a little more information as well regarding online slot gambling. ut all in all a very good blog. Good recommendations and good detail.

Dynamite said...

With gambling stocks, their is still an element of risk & luck. Why does the government consider stock trading to be a legal business while poker is an illegal act unless you do it in a licensed casino?

JJ said...

I wish I could go to Las Vegas, I love casinos but I have to Play Online Casinos instead. But if I win big online I’m flying straight to Las Vegas to play in a High Roller Casino and lose it all again! But it will be worth the experience!

JJ said...

I would like to go to Las Vegas and play in a high roller casino but it’s an expensive thing to do, even more so when you live in the UK. I have to resort to playing a casino game online instead which lets me win the money but I miss out on the atmosphere, but still save £600 on the 14 hour flight. So until I win big all I’ll do is play online casino dreaming of Las Vegas.

sheela said...

I recently came accross your blog and have been reading along. I thought I would leave my first comment. I dont know what to say except that I have enjoyed reading. Nice blog. I will keep visiting this blog very often.