BancBoston Robertson Stephens Provides Update on Gaming Industry, Raises Estimates on HET and MGG
SAN FRANCISCO, Aug. 24 /PRNewswire/ -- The following is being issued by BancBoston Robertson Stephens, a member of the National Association of Securities Dealers, CRD number 41271:
BancBoston Robertson Stephens senior gaming and lodging analyst Harry Curtis, a 1999 Wall Street Journal All-Star Analyst, today raised estimates on Harrah's Entertainment, Inc. (NYSE: HET) and MGM Grand, Inc (NYSE: MGG), while providing an update on recent developments in the gaming industry. Harrah's Entertainment is the most diversified gaming company in the casino industry. MGM Grand owns and operates the MGM Grand, its 5,005-room flagship property in Las Vegas and New York-New York, a 2,000-room property also in Las Vegas.
"We believe that fourth-quarter room rate trends in Las Vegas are accelerating in much the same way they did in first-quarter 1999," said Curtis. "We have been impressed with the growth in visitor demand through the seasonally soft summer months. This fall, however, strong tourist demand, partially driven by the opening of Paris in September, will be supplemented by strong-convention demand, which should give Las Vegas casinos, pricing-power.
"The California State Supreme Court today issued a decision overturning Proposition 5, the initiative passed in November 1998, which would have significantly expanded gaming at Indian casinos in California," said Curtis. "We expect this issue to resurface on the November 2000 ballot. In the meantime, the casino industry has a 15-month reprieve to orchestrate its strategy.
"Due to the strong industry forecast, we are increasing our third-quarter 1999 earnings-per-share estimate for MGM Grand from $0.44 to $0.50, above consensus of $0.47. Our fourth-quarter 1999 estimate increases to $0.53, in- line with consensus," said Curtis. "In addition, we are increasing our 1999 earnings-per-share estimates from $1.87 to $1.97, above consensus of $1.90.
"We are increasing our 2000 earnings-per-share estimate for Harrah's Entertainment from $1.80 to $1.85, well above consensus of $1.72," said Curtis. "This increase reflects a $0.05 per share contribution from the company's acquisition of Players International, which we expect to close during fourth-quarter 1999."
Clients interested in receiving more information should contact their salesperson at 415-781-9700. |
