Glenn Curtis of Investopedia recently suggested that it was time to leave the casino stocks. In his article he discusses 4 companies:
- Las Vegas Sands Corp.
- MGM Mirage
- Boyd Gaming Corporation
- Wynn Resorts, Limited
I haven't done a stock analysis post on these four companies but I did a quick check on each one. Frankly, none of them pass the test as a decent company. I would never suggest that anyone invest in these companies in their present condition. They just aren't that well run to justify an investment compared to other companies on the Good list!
A few of Glenn's comments (more here):
The space was in the spotlight earlier this month, thanks in large part to upbeat revenue numbers from Macau during December. Macau has become a hot destination in recent years and is located in China. But if you think all this means I'm bullish on some of the bigger casino names, you're mistaken. In fact, I think many stocks in this space are ripe for a fall.
Why My Reels Aren't Spinning
Many of the big names have had a huge run since the spring of 2009. For example, MGM Mirage has seen its stock rise from the low single digits, under $2 per share in the spring, to currently trading at around $11.50. Las Vegas Sands has seen its stock rise from under $1.40 per share to its present position, hovering around the $18 mark. But again, I think the run is severely overdone.
My No.1 concern is that I don't see many average people traveling, or even pondering expensive vacations in the months to come. And I'm not convinced that placing money into a slot machine or laying it on a hand of poker or "21" will sound too attractive to many, particularly until the job market shows some real life. In essence, the macro picture doesn't seem to match the rise in the escalating stock prices.
You can lose your shirt at the casino or investing in them!