Friday, August 10, 2012

Casino Stocks Fell On Nevada’s Casinos Falling Revenues – LVS, WYNN, MGM, MPEL

The recession is obviously taking its toll on gambling. The Nevada Gaming Control Board on Tuesday said that Nevada's casino revenues fell six percent in June while it showed only a marginal rise for the full year.

Total revenues for the state in June were $832.50 compared to $885.7 million in the same month a year earlier. This is the second consecutive month of decline that the state is seeing.

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Based on the revenues for the month, the state collected $38 million as taxes, down 27 percent from a year earlier. However there is not much of correlation between gambling wins and the tax collections since bets are often made on credit and the casinos don't pay taxes until the gamblers have actually paid up.

More than half of Nevada's revenues come from the popular Las Vegas Strip casinos, which brought in winnings worth $483.7 million in June, fall of 4.5 percent from the previous year. Downtown Las Vegas contributed $33.7 million, a huge 13 percent drop from a year earlier.

For the financial year that ended on June 30, total casino wins amounted to $10.7 billion, up 0.7 percent from the previous year.

Wagers rose less than a percent to $139.7 billion. Betting at slot machines rose 1 percent to $107 billion, while table game wagers edged up 0.6 percent to $31.8 billion.

Though the figures look low, the volume on the slot machines is the first increase reported since 2007.

The report also noted casino markets that cater more to locals than tourists saw modest gains, an indication that people are travelling less to these areas to gamble.

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Shares of Las Vegas Sands Corp.(NYSE:LVS) ended lower by 0.35% to $39.87 on Thursday, MGM Resorts International(NYSE:MGM) lost about 2%, Melco Crown Entertainment Ltd (ADR)(NASDAQ:MPEL) fell 2.30% and  Wynn Resorts, Limited(NASDAQ:WYNN) slid over 1%.

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