The number of mainland China tourists coming to Macau under China’s Individual Visa Scheme (IVS) increased 2.6 percent year-on-year in January, show data disclosed on Thursday by the city’s Statistics and Census Service.
Macau welcomed a total of 785,000 IVS visitors last month.
January marked the first month of growth in year-on-year terms of IVS tourist numbers since September 2015, when Macau recorded a slight increase of 0.6 percent in such type of visitors.
February could be the first month of casino gross gaming revenue (GGR) growth in year-on-year terms for the Macau market since May 2014, say two investment houses based on unofficial month-to-date returns.
“Macau’s gaming revenue picked up strong momentum since the latter part of the Chinese New Year holiday, despite a somewhat slow start in the beginning of the Chinese New Year,” brokerage Sanford C. Bernstein Ltd stated in a Monday note.
Analysts Vitaly Umansky and Simon Zhang wrote that, according to industry channel checks, Macau’s GGR for the week from February 14 to 21 was about MOP5.9 billion (US$737.2 million). That implied an average daily rate (ADR) of MOP843 million, an increase compared to estimated ADR of MOP628 million for the first 14 days of February, they said.
“Assuming an ADR of MOP600 million to MOP620 million for the remainder of this month, February GGR would be MOP19.5 billion to MOP19.7 billion, representing a minor year-on-year decline, or potentially positive year-on-year growth,” the two analysts added.
Casino GGR in February 2015 was MOP19.5 billion, according to data from Macau’s casino regulator.
“If February GGR grows year-on-year, it would mark the end of a 20-month consecutive GGR decline that started in June 2014,” Sanford Bernstein’s note stated.
It added: “While it does not necessarily reverse the trend (as we believe March and April may register year-on-year decline again), February GGR is poised to top our earlier estimate (and street consensus), which could provide some upside catalyst to Macau gaming stocks in the near term.”
Analysts David Katz and Brian Davis, from Telsey Advisory Group LLC, also said on Monday that – according to unofficial industry returns – a “marginal monthly improvement year-on-y
ear” was possible for full-February.
Are Macau’s darkest hours over?
Macau gaming specialist Union Gaming said Macau’s transit visa scheme is set to “undergo a significant positive shift at year end.” Being the only Macau-based gaming research shop, Union Gaming is a more authoritative voice in the investment community.
According to analyst Grant Govertsen, under the new scheme, the Macau government is likely to allow a Chinese citizen entering Macau using a transit visa to stay for up to 14 days from 7 days previously, and 7 days from 2 days previously if they are entering Macau for a second time in the same month. Serious Chinese gamblers have used transit visas in the past to enter Macau because they are easier to get than tourist visas.
Govertsen sees the VIP gaming segment to benefit the most from this visa restriction:
Interestingly, we believe the greatest beneficiaries of a relaxed transit visa scheme are those persons who facilitate VIP gambling (junket agents) and to a lesser extent premium mass players themselves. We believe it was junket agents who were the hardest hit when the transit visa restrictions were put in place in July 2014 as agents would generally want to spend as much time in Macau as possible as they want to escort their customers (the gambler) for the duration of the customer’s trip. Further, as we’ve spoken with casino operators over the past year and a half, they have indicated that some of their premium mass players had been negatively impacted by transit visa restrictions.
As previously indicated I post under both sawyerforyou and nameofthegame777
"On the sidelines with WYNN, but looking to buy very soon in 63-65 target range +/- 2 points.
Will be buying shares as well as long call kickers."
Yesterday WYNN hit within the high side of my buy target range of 63- 65 +/-2pts at 66.72
I entered 50% of my long shares position between $67.10 - 67.25 with a 25% long call kicker position.
I will be adding to both long shares and long call position as market conditions warrant
1st simply upside target 77 - 80
2nd upside target of 92 - 100 no later than mid November
Banco Nacional Ultramarino (BNU) and UnionPay yesterday launched a Triple Currency Credit Card, in which spending in Macau, Hong Kong and Mainland China is settled in MOP, HKD and CNY, respectively. The launch ceremony took place in Grand Lisboa Hotel attended by the Executive Director of BNU, Ronald Kan, and the General Manager from UnionPay International Hong Kong, Carlson Li.
According to the Macanese bank and credit card organisation, the product launched yesterday is the only ‘triple currency’ credit card in Macau.
“We believe that this card will be very popular because Macau is closely connected to Hong Kong and Mainland China. We believe this card will be very popular because of the settlement in these three different places in their original currencies, where there are no exchange risks and customers do not need to worry about exchange losses, especially during the fluctuations of the currencies”, Mr. Kam, the Executive Director of BNU, explained.
This new service will be available in three variants - Platinum, Gold and Classic UnionPay. While using this card, foreign transaction fees on spending in all other overseas countries, excluding Mainland China and the Hong Kong Special Administrative Region, are waived. This will allow customers to save around 1.95 per cent of the amount of their spending overseas, which is usually the rate charged.
One of those options is likely for MGM to adopt a real estate investment trust structure, as other casino companies have done or considered doing. But selling the Mirage isn’t out of the picture.
“At the end of the day, for the right offer, everything is for sale,” said Union Gaming Group analyst Chris Jones. “If someone comes knocking at the door with a giant bag of cash, it would be difficult for MGM to ignore that.”
Regardless of what happens with the Mirage, MGM will overhaul another one of its Strip properties: the Monte Carlo. The company announced in July that it will build a new 5,000-seat theater there — and that’s just the beginning.
MGM’s upcoming arena and entertainment promenade, the Park, sit between the Monte Carlo and New York-New York, which MGM also owns. Murren said that after the Park project began moving forward, MGM did “a number” of studies and focus groups and found that the Monte Carlo brand did not resonate with customers as well as other MGM properties did.
Murren previously has not ruled out a possible name change for the Monte Carlo. Now, he said “a name change is almost a certainty.” MGM is evaluating the resort’s non-gaming amenities to determine what the rebranded Monte Carlo could look like, he said.
The new theater should open at the end of next year, and details about the rest of the Monte Carlo’s future will likely emerge a while before that.
MGM is working on big projects elsewhere, too. Next year, the MGM National Harbor casino is set to open in Prince George’s County, Md., just outside Washington, D.C. The MGM Cotai should open in Macau next year as well. The company also plans to open the MGM Springfield in Massachusetts, although the opening has been delayed until 2018.
MGM has even expressed an interest in building a casino in Atlanta.
At the same time it is expanding in some locations, MGM has withdrawn from others. Earlier this year, MGM completed its sales of the Gold Strike in Jean and the Railroad Pass in Henderson. In July, the company announced it was selling the Circus Circus Reno and its half-ownership of the Silvery Legacy in Reno.
(part 3) of the Vegas Review Journal article dated August 1st
The REIT will have to find other operators. Conflicts and various state gaming regulations against multiple licenses could keep Penn and Pinnacle out of some management deals. There is a growing list, however, of emerging casino operators.
Golden Entertainment CEO Blake Sartini, fresh off its merger with Lakes Entertainment, is looking to expand and might be interested if Gaming and Leisure comes calling.
"If an opportunity is presented to us, it's something we would certainly want to explore," Sartini said.
Union Gaming Group analyst Christopher Jones said regional gaming valuations are supported "by transaction activity and the focus on real estate value." He said Boyd Gaming Corp., which said last year it was investigating the REIT process, might consider selling some of its regional casinos or spinning off the properties into a REIT.
Jones said Boyd has "less of an appetite" to fold its Las Vegas holdings into a REIT "given the bullish outlook for (cash flow) growth in that market."
The REIT idea was first proposed to Pinnacle in April 2014 when activist investor Orange Capital urged the company to separate its real estate from the casino operations. Pinnacle announced its initial plans in November. Gaming and Leisure entered the picture in March, proposing to save Pinnacle the trouble and $700 million in costs of forming a publicly traded REIT.
After several months of negotiations, the two companies' boards approved a deal that gives Pinnacle shareholders 0.85 per share in Gaming and Leisure for each Pinnacle share they own. Also, Pinnacle shareholders will receive one share of the remaining Pinnacle Entertainment casino operating business. Pinnacle shareholders will own 27 percent of Gaming and Leisure once the transaction closes.
"We created value for our shareholders," Sanfilippo said. "They can keep the stock or turn into cash."
REITs don't pay federal income taxes and distribute 90 percent of their taxable earnings to shareholders.
Moving into a REIT structure won't preclude Pinnacle from expanding. The company retained ownership of its Cincinnati-area racetrack casino and has free cash for additional acquisitions, with or without Gaming and Leisure. Penn National, for example, bought the Tropicana for $360 million, opened the Plainridge Park Casino in Massachusetts for $250 million, and is spending $390 million on a San Diego-area Indian casino — all without Gaming and Leisure.
Wall Street says Gaming and Leisure is still shopping for regional casinos and Chairman Peter Carlino confirmed opportunities exist. Simkins said Pinnacle was one of the last "high quality assets" on the market. Still, other regional properties could be ripe for the taking.
Gaming and Leisure "should be the first call for any potential seller," Simkins said.
(Stack and Heritage Steakhouse). The Mirage also has one of the best high-end villa projects in the market. However, in recent years MGM took all of its international-marketing team and international players out of the property. Overall, the theme is a bit outdated, in our view, and the property could certainly benefit from a refresh. We also note the Mirage’s feature volcano is erupting less frequently.
We estimate The Mirage’s 2015 earnings before interest, taxes, depreciation and amortization (Ebitda) of $145 million. For reference, a purchase of 10 times Ebitda would imply a price target of $1.4 billion. A one-off buyer would likely have to unplug from MGM’s player database, which would impact results. The sale of the Mirage would be a deleveraging event for MGM. The stock is currently trading at 10.7 times our 2015 Ebitda estimate. MGM is due to report second-quarter results on Tuesday, Aug. 4.
Murren, who has been MGM chairman and CEO since 2008 and a company executive for more than a decade, believes REITs are in the gaming industry's near future. Penn National's spinoff won't be "a lone ranger."On Tuesday, GLPI announced a deal to acquire Pinnacle Entertainment's real estate.
Murren said REITs might be the best way for the gaming industry to better market its land. MGM Resorts, for example, controls more than 800 acres on and around the Strip.
"This is not an academic exercise," Murren said. "I believe this is a secular change in this industry and I intend for MGM to be a leader in any change that occurs."
A REIT "is one of 300 different ideas" being discussed and Murren wants an answer by the end of the year.
During the proxy fight, Murren talked with MGM's largest shareholders about ways to grow the company's value. MGM is building the $1.2 billion MGM National Harbor in Maryland and the $800 million MGM Springfield, adding more nongaming attractions in Las Vegas and expanding its footprint in Macau.
The investment community, however, hasn't ascribed value to those efforts.
The company has a "visible pipeline" for growth and is part of the discussion when a state explores gaming expansion. MGM was tied this month to a proposed $1 billion gaming complex in downtown Atlanta if Georgia lawmakers legalize casinos.
Stifel Nicolaus Capital Markets gaming analyst Steven Wieczynski told investors he expects MGM to announce a "strategic initiative" sometime after September that "should drive interest levels in the name higher."
He predicted a REIT structure involving MGM's non-Las Vegas resorts in Detroit, Mississippi and the Maryland and Massachusetts projects. Wieczynski speculated a few of the company's Strip resorts could be part of the REIT, but he said that decision hadn't been made.
"There are multiple options out there for MGM to pursue," Wieczynski said.
In June, Litt recycled his REIT idea, using the planned liquidation of the stock controlled by the late MGM founder Kirk Kerkorian as way to draw attention. The effort was largely ignored.
Murren said MGM Resorts is "very engaged" in the REIT issue.
"We know more about this subject than we did two years ago, and quite a bit more than people realize," he said.
Let's get are fact straight:
"Casino magnate Steve Wynn already knew Atlantic City would become obsolete in the 1980s, when he sold his casino there less than a decade after opening.
Wynn, who got into the Las Vegas casino business when he was 23, started the Golden Nugget Atlantic City in 1978. It opened a year or two later, but Wynn sold it in 1987."
Wynn had nothing to do with Revel Casino-
Yes, check out my recent post on Yahoo's Market Pulse posted under nameofthegame7
Stifel Nicolaus Capital Markets gaming analyst Steven Wieczynski
Analysts are bullish on MGM Resorts, but not because of baccarat.
The company operates 10 Strip properties, including CityCenter, MGM Grand, The Mirage and Mandalay Bay, encompassing 41,000 hotel rooms and two large convention complexes.
Zarnett said cash flow from the company’s flagship Bellagio are just 5 percent off the property’s 2007 peak, the best result he has seen on the Strip.
Wieczynski told investors that shares of MGM Resorts, traded on the New York Stock Exchange, will see the best boost in value of any gaming company if current trends continue.
“MGM’s Strip returns have also benefited from judicious cost management, which has allowed modest top-line gains to generate outsized cash flow growth,” Wieczynski said.
MGM Resorts also is expanding in Macau, adding the $2.9 billion MGM Cotai. The resort is expected to open in 2016. Most analysts believe Macau will stage a comeback starting in the second half of this year.
Wieczynski said the MGM Macau, which opened in 2007, “makes the most of the market’s current realities,” operating just 9 percent of the overall table games in the region. The Cotai resort will double MGM’s footprint in Macau.
“The greatest value lies in its ability to grow MGM’s share of the market’s nongaming business, the segment we expect to deliver superior return in the years ahead,” Wieczynski said.
He said Macau will transition “from a gambling enclave into a total entertainment destination.”
The predictions already are starting for 2016.
Looking Good Billy Ray! Feeling Good Louis! Setting the table: Perhaps MGM may even begin to seriously consider(not hint at as before) selling off Crystals at City Center for a Billion + borrowing rates are cheap for a new acquirer to pay top dollar in 2015.
Over the next three years, Galena can put blocks of its stock to Lincoln Financial for purchase, up to $50 million. Left unsaid by Galena is that Lincoln Park gets to buy this stock at best price, if not a discount, to the market. According to the deal terms described in the SEC filings, the purchase price of the Galena stock will be the the lower of two scenarios: 1) the lowest sale price of the common stock on the date of purchase; or 2) the average of the three lowest closing sale prices for the common stock during the 10 consecutive business days preceding the purchase date.
What does Lincoln Park do with the Galena stock it buys from the company at a discount? The firm re-sells the stock right back into the market, making a profit on the difference in price. Galena describes Lincoln Park as an "institutional investor," implying the firm is investing in the company as a long-term shareholder. That's not how Lincoln Park operates.
Galena' press release claims Lincoln Financial is prohibited from shorting the company's stock, but the fine print of the deal disclosed in the SEC filings only says Lincoln Park is restricted from having a "net short" position. That's a subtle difference but important because it allows Lincoln Park to make additional money off Galena by arbitraging, or selling, shares it expects to receive.
Over time, existing shareholders of troubled biotech companies tend to be the biggest losers when Lincoln Park gets involved.
Aastrom BioSciences entered into a stock purchase arrangement with Lincoln Park last January. Since then, Aastrom's stock is down 16%. Oncolytics Biotech did its Lincoln Park deal in February. The company's stock is down 60% since that deal was announced. Biodel : Down 21% since its Lincoln Park financing was signed in July. Ocata Therapeutics : Down 13% since Lincoln Park started buying the company's stock in July. And Soligenix shares have lost 17% of their value since the November
(Part 1)Its always best for investors to know who the company is getting their financing from and why, period.
Galena, Shunned by Wall Street, Forced to Seek Pricey Vulture Financing
Lincoln Park Financial set up a $55 million line of vulture financing for Galena Biopharma (GALE - Get Report) last week, the scandal-ridden bio-tech company still under active SEC investigation for paying outside firms to promote its stock while insiders made millions of dollars selling company shares.
Lincoln Park's involvement here is interesting in that these are the guys willing to throw a cash lifeline to companies unable to raise money via a traditional stock offering. Galena, according to a source familiar with the company's funding shortfall, was unable to muster sufficient interest from institutional investors. So, Galena has apparently turned to Lincoln Park, which has a reputation for financing troubled biotech companies -- but at great cost.
Galena tried its best to spin the Lincoln Park arrangement positive, but the onerous deal terms are detailed in the company's regulatory filing with the SEC.
Under terms of the agreement, Lincoln Park is buying an initial $5 million in Galena stock at $2 per share. Galena, in its press release, claimed the purchase price was 9% above the stock's closing price of $1.84 on Nov. 18. Galena failed to mention publicly that Lincoln Park was given 631,221 free shares of company stock in order to make the financing happen. Add those free shares into the calculations and Lincoln Park's $5 million initial investment in Galena is valued at $1.59 per share, or a 14% discount to the market price at the time the deal was signed.