Gaming’s major public companies fared well Monday despite the major indices dropping substantially while Congress grilled people about the WorldCom company’s fraudulent filings.
While the Dow fell more than 104 points and the Nasdaq threatened the 1400 level by dropping more than 42 points, some of gaming’s high-flyers such as Harrah’s Entertainment Inc. (HET) and International Game Technology (IGT), and lesser-known Shuffle Master Inc. (SHFL) posted major gains.
Harrah’s Entertainment Inc. closed at $45.08, an increase of $1.68 for a day that saw more than 1.3 million change hands. IGT climbed $1.46 to close at $59.56 with more than 1.2 million shares being traded. And, little Shuffle Master with only 198,000 shares traded moved to $18.77, a jump of $1.16 for the day.
Lesser profits were noted by Boyd Gaming Corp. (BYD), up $0.73 at $14.62; Alliance Gaming Inc., $12.25, up $0.22; Isle of Capri Inc. (ISLE), $18.67, up $0.48; Park Place Entertainment Corp. (PPE), up $0.23 at $10.38, and Mandalay Resort Group (MBG), $0.18 at $27.01.
Not fairing as well on a difficult day were MGM MIRAGE Inc. (MGG), $33.40, down $0.58; Ameristar Gaming Inc. (ASCA) $26.30, down $0.68, and Station Casinos (STN), $16.60, down $0.55.
Other gaming companies showed substantial strength Monday. They included Churchill Downs Inc. (CHDN) whose shares closed at $37.95 with a gain of $0.95; GETCH Holdings Inc. (GTK), $24.04,up $0.84, and Aztar Corp. (ARZ), $19.60, up $0.22.
The decline in the stock of MGM MIRAGE came shortly after Harry Curtis, the gaming analyst for JP Morgan raised his estimates for the company’s earnings for the 2002-2003 period. He said he believed both Bellagio and Mirage casinos "are experiencing a faster rebound in revenues than expected and increased revenues coupled with a reduced cost base should result in expanding operating margins.
Boyd Gaming also was the subject of an upgrade on Monday. Wells Fargo boosted the company to a buy from market perform based on the company’s "visible long-term earnings growth prospects as well as relative valuation.
Zacks.com looked favorably at Park Place Entertainment placing the company on its "coveted Zacks #1 Ranked" list. Zacks analysts said Park Place "continued to experience strength in the biggest markets around the country, including 2.5% same store revenue growth in Atlantic City."
Alliance Gaming Corp. (ALLY) said Monday it had received approval from the Nevada Gaming Control Board for its SDS Coupon cashless product designed to give casino operators a new marketing tool.
The system, developed by Alliance’s Bally Gaming and Systems business unit, allows casinos to reward players without giving away cash by issuing bar-coded coupons that are fed into a slot machine’s bill validator to provide promotional credits.
Alliance said the system already is in place with some of the machines used by Harrah’s Entertainment Inc. and that Harrah’s plans to have an additional 12,000 slot machines from a variety of manufacturers upgraded in the coming weeks.
Boyd Gaming Corporation (BYD) announced over the weekend that it has relinquished its exclusive rights to manage a casino for the Narragansett Indian tribe in West Warwick, R.I.
The company said it felt stymied by the Rhode Island General Assembly that substantially postponed approval of a gaming compact by ordering the creation of a gaming study commission. This action would postpone the possibility of a casino until at least 2004.
Commenting on the decision, Rob Stillwell, vice president of corporate communications, said, "From a business standpoint, if the chances are slim to none, it doesn’t make a great deal of sense to spend a great deal of money pursuing something that doesn’t seem likely this year." He added, however, that if the political climate were to improve, "we’re very, very interested."
Efforts to target children by an arcade that installed three slot-style video gambling machines have been foiled. The three machines ”” called Wild Safari, Wild Diamond and Blazing 777 ”” were shut down at the Charleston, W. Va., Town Center by both police and state lottery officials.
Operators thought that since the machines paid out in tickets instead of coins that they could be utilized. Not so, said a representative of the lottery board. "According to the law," he said, "games-of-chance machines that accept tokens and pay out in tickets redeemable for prizes are as illegal as ones that take in cash and spit out cash."
Fulfilling a previously announced promise, world-class poker player Len Berman, chairman and CEO of Lakes Entertainment Inc., formerly known as Lakes Gaming Inc. (LACO), has put up $3.3 million to obtain its 78% stake in the recently-launched World Poker Tour.
Berman admits the investment is a risk but that his track record involves taking risks. Berman founded Grand Casinos Inc. to manage Indian casinos in Minnesota long before other companies saw the benefits of such an activity. He also invested in the construction of The Stratosphere Hotel/Casino when the property ran out of funds while being developed by Bob Stupak.
"A defined risk," said Berman, "has the potential for a big reward." He reiterated that the company’s primary business is "running casinos for Indian tribes" but that since current contracts are awaiting final approval this project gives the company current activity.
"There are 50 million people in the country who play poker on a semi-regular basis," he was quoted as saying. "We feel this can become a major sport on TV."
Now that the U.S. Department of Interior has resolved an attempt by a tribal court to enter a $1.8 bill judgment against Park Place Entertainment Corporation (PPE), the company issued a statement emphasizing the opinion of federal authorities.
"The Department of the Interior, in a June 26 letter to U.S. Magistrate David E. Peebles, said in a clear and unambiguous language that the Tribal Court judge who entered a $1.8 billion judgment against the company in March 2001 was not legally appointed and had no legal authority to take that action," said Kim Sinatra, Park Place executive vice president and chief legal officer Kim Sinatra.
"Specifically, the department said: "”¦the person representing herself as the tribal judge was not appointed or elected pursuant to the Tribe’s Judiciary Act, and her rulings are not recognized by the Department as expressions of tribal law."
A new $500 million credit facility made available by banks and institutional investors has been completed by Boyd Gaming Corp. (BYD). The company used CIBC World Markets as the lead agent with additional assistance from Bank of America, Credit Lyonnais, Deutsche Bank and Wells Fargo.
Slot giant International Game Technology (IGT) will host a conference call regarding its third quarter earnings at 11 a.m. PDT on Tuesday, July 23. MGM MIRAGE Inc. (MGG) will conduct a second quarter conference call to be broadcast on the Internet on Wednesday, July 24, at 8 a.m. PDT. And, Penn National Gaming Inc. (PENN) will release its second quarter results at 7 a.m. PDT on Thursday, July 25.
Supporters of installing gaming devices at Arizona’s horse and dog tracks have filed 187,940 signatures with state officials to quality a bill for November’s general election ballot.
TransAct Technologies Inc. has indicated it has received a contract from GTECH Holdings Corp. (GTK) worth $20 million for thermal printers.
Contrasting reports have been issued by the states of Kentucky and Illinois regarding the experience of horse race meets in their respective states. Kentucky reported record business at the recently-conducted meet at Churchill Downs. Illinois said it believes that its tracks will suffer because of the elimination of several of millions of dollars due the purse accounts but which have been eliminated by Gov. George Ryan.
Boss Media Group of the United Kingdom claims its SuperVegas Casino is the largest global online and telephone sports betting and casino company with about 450,000 customers. It recently launched a second online casino called Victor Chandler Casino.
According to Atlantic City, N.J., press reports, MGM MIRAGE Inc. sold 28 condominiums for an average price of $28,000. When the company purchased the condos, it paid between $82,500 and $112,500 per unit. The properties were located in the area where the company had planned to build a major resort on the Atlantic City Boardwalk. The plans were set aside when the company purchased Mirage Resorts and took over the H-tract where it has a half-interest in The Borgata now under construction.
The troubled Tigua Indian tribe of El Paso, Texas, will attempt to resume payments to its members despite the fact that their casino has been closed by federal authorities. Closing the Speaking Rock Casino caused the tribal council to suspend payments.
Frustrated by the rejection of an approved gaming compact with Louisiana officials ”” a compact that was rejected by the Interior Department ”” the Jena Band of Choctaws is now eyeing Logansport, La., as a location for a proposed casino. The property would be must closer to the Texas border that the five riverboat casinos in Shreveport-Bossier City.
An off-track betting parlor has been authorized by the Indiana Horse Racing Commission for Evansville, Ind. The property will be operated by Indianapolis Downs, a race track now under construction in Shelby County.
As long as there is neither a state nor a federal ban on Internet gambling, California Indian tribes now have the right to negotiate the activity as part of their gambling compacts with the state.
An agreement that would have seen Las Vegas slot bar operator Terry Caudill taking over the Four Queens Casino in Downtown Las Vegas has fallen through, according to information filed with the SEC. Four Queens is owned by Elsinore Corp.