Gaming stock prices take a further blow

07.30.2008 | 4:43 am | News, gambling

Last Friday saw another steep decline in the average daily stock price of nine out of the ten publicly traded gaming companies in Las Vegas. Applied Analysis, which tracks the stock price changes of these ten corporations, charted a fall of up to 35 percent, continuing the slide which began in March. Overall, this slump has sent the Applied Analysis Gaming Index down by 58.54 points to its lowest figure since September 2006 – to just 370.58 in the past month.

The companies with the steepest declines were the Boyd Gaming Corp. and MGM Mirage, registering drops of 35 percent and 33 percent respectively. Additionally, the leading corporation Las Vegas Sands, which owns successful Strip casinos such as the Venetian, registered another steep drop of 28.8 percent, despite its 81.4% increase in revenue within the quarter.

These fluctuating figures are largely billed as being due to the concerns of investors thanks to several pieces of bad news during the last quarter – for example, gaming revenues reaching their lowest point in May for 24 years, along with casino-specific news such as the announcement of MGM Mirage that their financing for the delayed $9 billion CityCenter development had not yet come through. Brian Gordon, partner at Applied Analysis, yesterday stated that “investors are concerned… there’s a lack of confidence” and explaining that “low levels of consumer confidence have spilled over into concern on the part of the investors”.

However, some industry experts see a more positive future for the gaming stock market, with reports that some major gaming companies gained in value during the last few days of July – and several casino operators have reflected this by reporting that July’s gaming action has been better than previous months. The future may see a marked improvement in the stock value of the gaming industry.