Sunday, December 27, 2009
Macao, Taipa, Macau - will this "city of dreams" bring you a 2010 Casino investment?
I thought I was going to write a buttoned up nice little article on investments to profit on the thriving Macau casino business's, but it turned out to be a more complicated discussion than I first thought. Pictured to the right is the Casino Lisboa which is owned by Sociedade De Turismo E Diversoes De Macau, (Symbol HK: SJM) which is owned by Stanley Ho(Hung-Sun) and his family and trades on the Hong Kong stock exchange. Stanley has had a monopoly franchise on the Macau casino business for 40 years before anyone else arrived. All the current folks have only been there 10 years. Taipa is the smaller of the two islands in Macau Special Administrative Region of the People's Republic of China (formerly the Portuguese colony of Macau).Craig Stephen's "This Week in China" on Marketwatch.com is an excellent source on keeping you up on events in Macau. The Chinese government holds the ultimate trump card here, like many other things in the world, so add a dose of measured risk for that fact. Also there are Hong Kong exchange stocks and US exchange stocks with varying levels of exposure to this market and the associated risk. Wynn and Las Vagas Sands have stocks on both exchanges. If you want to see the Hong Kong stock exchange it is listed at http://www.hkex.com.hk/index.htm, I will limit my discussion to the US investment stocks. WYNN (Symbol WYNN) and Las Vegas Sands (Symbol LVS) which owns the largest hotel in Macau, The Venetian Hotel Resort, are safe ways to get exposure to the Macau action. Melco PBL Entertainment LTD ADS (Symbol MPEL) with the "City of Dreams" on the Cotai Strip should also be one to look at. All of us were cheering for Playboy (Symbol PLA) with their Macau location to be a boom for the company, but evidently they are playing with such a "short stack" at the poker table that Iconix Brand Group (Symbol ICON) that makes London Fog raincoats, walked away from a buyout opportunity of PLA last week. That must be one ugly Bunny balance sheet.
If you are in the market to just look at some good casino stocks and don't care about China, WMS Industries (Symbol WMS) and Penn National Gaming, Inc (symbol PENN) are both worth a look.
If anyone has comments on the other Hong Kong exchange traded stocks in Macau with more information, I invite you to comment on this blog and share with others your insight.
Season Greetings and Happy New Year,