Friday, March 14, 1997 | 11:59 a.m.
FOR MORE MONTHS than I care to recall, I haven't had much good to say about gaming stocks in general (except comments with respect to New York-New York) or trends in the State of Nevada Gaming Control Board's Monthly Revenue Report. This may be about to change.
January 1997 Strip revenues, after eliminating Baccarat, gained by some 14.9 percent or a whopping $40 million -- a noteworthy reversal of recent trends. This report follows a lengthy 1996 series of severely negative monthly reports on Nevada's gaming revenue numbers. It also provides an indication that at long last there may be good news ahead and a better tone for Las Vegas' long-suffering gaming stocks.
With Strip non-Baccarat gaming revenue recording a $40 million gain in January, questions arise as to its source. Airport traffic volume in January (up 7.5 percent) was not strong enough to indicate the possibility of a strong resurgence in visitor volume. The latter is a function of both airport and vehicle traffic since Las Vegas visitors arrive about equally from these two sources.
The Las Vegas Convention and Visitors Authority visitor report for January is not expected for another week or so. Thus, visitor numbers will not be available to Wall Street until that time. The best motor vehicle traffic numbers will also be included in that report.
For some time now, I have written about New York-New York's spectacular opening success. The Las Vegas Investment Advisors weekly visitor survey at New York-New York clearly signal that the property is gaining popularity with the passage of time. Through March 8 of New York-New York's existence, minimum average table game bets at the 2 p.m. survey time have about doubled from the opening level (Jan. 4) and there is no let up in the nearly 1 million visitors per week. I expressed in previous published columns my concern that if New York-New York's eye-popping revenues and visitor counts were at the expense of other resort facilities, 1997's first quarter cash flow and earnings numbers for all but New York-New York may be disappointing, thereby acting as a further depressant on gaming stocks.
We are now inclined toward the view that New York-New York's opening, almost single-handedly, has caused an increase in motor vehicle visitor traffic -- particularly from California.
My gaming analyst counterparts in Wall Street (who have felt pretty gloomy for some time now) may, at long last, have something good to write about. Dave Anders, a gaming analyst, faxed out the January Strip gaming numbers, noting that the "win was up a surprisingly strong 15 percent for the month." If these numbers can sustain the initial growth, gaming stocks may have seen their lows. It's about time.
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