Major gaming companies' shares rise despite slowdown

May 12, 2009 5:04 PM
Earnings by Ray Poirier | Betting on hope more than on recent experience, most major gaming companies saw their individual share prices rise despite reporting the effects of the recent economic downturn.

Wynn Resorts Ltd. (WYNN) reported a loss of $38.8 million or $0.30 a share during the quarter that ended on April 30 yet the company’s shares more than doubled following the sale of some eight million shares at $19.50 each in late March. On Friday, the shares closed at $47.46 each.

Las Vegas Sands Corp. (LVS) shares stumbled into April at $2.80 each but rose to $10.50 despite the company’s loss of $87.7 million or $0.14 per share during the first quarter of the fiscal year.

Shares of MGM MIRAGE Inc. (MGM) did even better than LVS during the period rising from $2.40 on April 1 to Friday’s close of $12.58 even after reporting a drop of 20% in revenue during the first quarter.

Even Boyd Gaming Corp. (BYD), which reported a loss of $13.8 million or $0.16 per share after taking a $28.4 million charge against its purchase of Dania Jai-Alai in Florida, saw shares increase from an April 1 level of $3.71 each to Friday’s tops of $12.24 each.

Not all companies reported losses, however. Bally Technologies Inc. (BYI) reported earnings of $29.3 million or $0.52 per share, essentially flat with last year. Yet in the past five weeks, the company’s shares rose from $18 each to Friday’s closing price of $27.24.

Also showing surprising strength was Landry’s Restaurants Inc (LNY), owner of the Golden Nugget casinos in downtown Las Vegas and in Laughlin. The company’s shares have risen from $5 each to Friday’s $9.69. During the first fiscal quarter, the company said it earned $7.4 million or $0.44 per share compared to last year’s $1.5 million or $0.09 per share.

Despite seeing its revenue decline by some 3%, MTR Gaming Inc. (MNTG) reported a profit of $752,000 or $0.03 per share compared to last year’s loss of $2.6 million or $0.10 per share in the quarter that ended on April 30. The company’s shares had fallen as low as $0.86 each but has moved up to Friday’s close of $2.33 each.

Also showing a profit after a series of losses was Lakes Entertainment Inc. (LACO). Earnings for the first quarter reached $1 million as against last year’s loss of $6.9 million.

Among the companies that showed improved results, despite incurring losses during the quarter, were:

Riviera Holdings Corp. (RIV), a loss of $1 million or $0.08 per share compared to last year’s loss of $5.8 million or $0.47 per share.

PokerTek Inc. (PTEK), a loss of $1.8 million or $0.16 per share, slightly better than last year’s loss of $2.1 million or $0.20 per share.