... the lack of forward thinking... which is a fault of most investors.
MF, like so many momentum investors out there, like to talk about what's going well and assign what's going to happen based on the good things that are already happening. Aside from a few people who have the tenacity to follow IBD to the letter and ask "how high" when IBD says jump, momentum investing is usually not good investing... it's just racing with the Joneses.
I've never seen a Motley Fool writer buy a beaten-down stock with baggage but good potential... which is what I do.
You might say LVS was that kind of stock 2 years ago but not today and I'd agree to some degree... LVS has moved from the "birth" phase of Templeton's mantra to the "growth" stage (with a brief jump to the "mature" phase last November) but my reasons for still liking LVS are still contrarian...
... the underperformance in Macau is the major element... with a kicker from the Jacobs tiff... but some continued, slow improvement in Vegas also plays a bit role in my thinking.
On Cotai, I don't believe most people have an appreciation for the immense leverage Sands will get from the opening of galaxy and 5&6. It isn't just 5&6 that will accelerate EBITDA but the powerful overhead absorption that Venetian will get on it's under-utilized assets with the opening of those 9000 new hotel rooms all around it. People just don't realize how many Cotai visitors don't stick around to shop and play because all the hotel rooms are on the peninsula and, as they say, people primarily play where they stay. All the new Cotai asset that will open over the next 18 months are adjacent to Venetian with Venetian at the center of it all...
... that, plus a re-vamped VIP stratgy and Goldstein now in charge of global gaming hopefully able to do with Cotai what he's done in Vegas, makes me optimistic about next fall and I think the market isn't pricing that "potential" in at $46 a share.
Gotta go... thx all for your kind words!
I enjoyed reading your clear and better written response than the original article. Travis definitely got defensive. Probably just a little embarrassment combined with research and literary enviousness.
keep on keeping em honest!
I could not agree more... I especially liked your MBS / Singapore market size being as big as the entire Vegas Strip. It's even bigger if you add in the tax rate advantage. The Elaine and dividends comment very appropriate too in a sarcastic sort of way.
I think WYNN paid out $12 per share in dividends last year. That pays for a lot of Stevie's divorce, alimony, and new wedding gifts for the bride. Alas, it comes with a price of sacrificing the future for the presents...
... as a virgin, hyper-growth gaming geography, it's hard to imagine turning one's company into a high-dividend, ultra-conservative company...
... at such a historically transitional time as this.
Wynn does a lot of things well but beyond his strengths, there are the same deficiencies that led to his loss of control over Mirage resorts so many years ago. In those days, he sidetracked the company in many ways that didn't contribute to a robust future for Mirage. Jettisoning crucial investment capital (via big dividends) during a pivotal time when investment capital has such international ROI potential is a similar mistake, IMO.