--->continued from part 2
An update on Anchor Gaming (SLOT, 47) part 3:
2) Then, there are SLOT's casinos, which have placed in a low-competition environment until recently (and have been amongst the most profitable casinos in the USA: see above). However, the climate is getting tougher in Colorado, as new and bigger casinos have been opened in the vicinity. Therefore, profitability of Anchor Gaming's two Colorado casinos declined somewhat this year (mainly due to higher promotional costs and higher salaries), which does not prevent them from being very profitable. PWRH's Sunland Park casino (which operates in a low competition environment, represents a welcome addition to the casino portfolio (see above).
3) As mentioned above, SLOT's gaming machine route continues to be a profitable high quality source of recurrent revenues.
All told, trading at about 9 times current EPS, 2,5 times book value and 2 times sales, SLOT appears to be cheap, even considering the possibility of several legislation issues which might impact the growth of the gaming industry in Northern America. The current, and probably the next quarter results might be somewhat "disappointing", until the effect of the new machines and conversion kits "kick in", but the long-term outlook is very promising.
Therefore, TheIrb, you have to decide your-self whether SLOT looks promising, or not. I, for my part, do not even DREAM of selling; if anything I buy.
regards DrJohn |
