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Non-Tech : ASCA Ameristar Casinos

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To: brad greene who wrote (19)	5/18/2000 10:51:00 AM
From: brad greene	Read Replies (1) of 24

Isle of Capri All ASCA, I know these posts don't mean a whole lot right now. But should ASCA get some new coverage....they will. I have been looking at ISLE as a good comp for ASCA. They have a few riverboats and some other stuff......and have revenues that are about 2x ASCA's. They have 30 million shares outstanding....20 million in the float Their stock has gone from $5.00 to $15.00 in the last year. CBCI World markets inititated coverage on ISLE a few days ago with a buy rating. The EBITDA per share for ISLE for 2000 is about $4.30 per share. ASCA should do $80 million in EBITDA this year....up from $50 million last year. This works out to about $4.00 per share. ISLE's debt to equity ratio is 6.4.......This makes ASCA's 3.4 look pretty good. I don't think there is any question that ASCA is deeply discounted to the industry. The one analyst that covers ASCA notes the fact that 87% of the stock is owned by the CEO as the largest risk factor.....but that management had promised to "address" the problem. It is a tough problem. The CEO must feel that ASCA is worth upwards of $10.00 per share......so why sell or do a secondary at $5.00?......and if the analyst won't move ASCA from "hold" until more stock is out there? It is a near term catch 22.....IMO. I think two positive things can happen on this front. One, is that you have a couple more analysts begin coverage on ASCA who are willing to value ASCA more in line with the industry. Since there were five or six other analysts on the conference call.....I know that they are at least paying attention. The other is for ASCA to just perform it's way to a point at which the discount to the market is so deep, that value investors bid up the stock price to reasonable levels. It will be interesting to see how this works out.......The industry is turning in great numbers.....ASCA is turning in great numbers. All of the other casino stocks are booming....while ASCA has remained flat. ASCA has gone from -62 cents in 1998.....to +1 cent in 1999.....to an estimated +62 cents in 2000. How ASCA will not be moving up in this environment.....is a mystery to me. Perhaps someone will take notice. ASCA will do close to $350 million in revenue this year......they have top-drawer properties.....and are a public company. They deserve to have more coverage than just one analyst. Maybe ASCA could send out some fruit baskets....or something.<g> bg

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