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Boyd Gaming Corporation Message Board

  • zzdoor zzdoor Jun 5, 2008 11:10 PM Flag

    Why Buy BYD? - This is why

    William Boyd is not unlike Steve Wynn having started in 1941 with $30 in his pocket. Yes the company is 2 billion in debt. But they borrowed the money cheap to build the Echelon which when compplete will be every bit as impressive as the WYNN across the street. Boyd bought the Stardust in the late 80's when it was still possible for a medium size company to acquire land on the underdeveloped side of the strip. Today, it would be impossible for a company like BYD to make such an acquisition. We are now at the turning point from a mid size player to major player. Boyd made a calculated risk to capitilize on cheap finance rates and their ownership of a very valuable piece of real estate across from the Wynn. It was a good gamble. Now consider that Boyd owns half the Borgata with MGM owning the other half. This hotel is hands down the most popular in AC and now with the Water club open, BYD can start to get a return on this investment. Further consider that MGM has real plans to build a mega resort adjoining the Borgata to the tune of around 5 billion. Think this will help business at the Waterclub and Borgata? Further consider that BYD still turns a profit and pays a 4% dividend while currently selling at book value with a P/E and Debt half that of WYNN. Now consider that WYNN is now Price to book of 6 compared to 1 for BYD. When the Echelon opens in 2010, tell me BYD will not be every bit as valuable as the WYNN? That means $100 a share friends. If we just jump up to 20, the high short interest will bail and cause a squeeze. And further, at 15 this company is most definitely a buyout target. Do you know that BYD did not layoff the workers at Stardust but offered most jobs at other company properties.
    This is a good company and I am in at $15.10 and intend to ride this stock to 75 when the Echelon opens in 2010.

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    • The Venetian seemed busy on Wed.

    • What's the business model.? Will the tower owners fill the rooms and send them to the casinos.

      As I see it, Vegas was built on the mechnical slot. A reliable source of income for player and casino. Those days are gone.

      Vegas has turned itself into a gamblers only destination. No vacationing with family or kids.

      Oil has doubled airfares. No tourists. Only gamblers and conventioneers.

      The Macau model won't work here. Chinese are natural gamblers. They know enough to stay away from anything with a chip in it. That would mean hiring 50,000 more croupiers like in Macau. Very labor intensive.

      Recap: Vegas has priced tourists and families out of the equation. The players they want don't play the machines. They have to incentivize marginal players. Like the Macau Venetian subsidizes the L.V. Venetian. The economy is in recession. Machines are getting tighter. And worst of all, there is no place for rest and recreation like other destinations. Times look hard for Vegas. So, what's new.?

    • Very true! But I am willing to bet those HoT euro chicks and fast euro money men can spend more freely than the average U.S.. Joe!

      When SW, Okada, the Country Club, Bartolatto, ALEX, Terrace pointe and TRYST are all packed...I will bet his margins are holding up!

      The fact is his clients have much more spending power, those europeans have an almost 2:1 by coming to the States.

    • They are ALL suffering margin issues wynn packed doesn't tell you what they spent to get the players in, no ?

    • <<<<<<Steve Wynn having started in 1941 with $30 in his pocket. >>>>>

      What have you been drinking? Bill was born with a PLATINUM sppon in his mouth and a silver one shoved up his ass. SAM Boyd is the Horatio Alger of the family.

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