MGM Stocks Shares Take a Beating
October 1, 2009 by Banker
Filed under Investing Journal
Today after recent news that the MGM company would not be able to fulfill their plan of a debt swap offer. This news drove MGM shares down several percent throughout the day, with a total loss of more than 10% on the share value and cost.
| 10.71 -1.33? (-11.05%?) Oct 1 4:01pm ET 10.70? -0.01? (-0.09%?) After Hours |
||||||||||||||
|
|
|||||||||||||
| Disclaimer | ||||||||||||||
The debt swap offer was called off due to the required minimum amount of notes not being tendered by holders, the debt exchange would have allowed current holders to exchange a portion of an existing $782 million in 8 .5% notes due in 2010, for the company’s 10 percent notes due in 2016.
(from StreetInsider MGM MIRAGE) – Hold rated, $13 price target. Soleil notes that MGM has dodged liquidity issues, but also points out that the casino operator “still faces debt maturities, Vegas capacity growth and a full valuation.” According to the firm, MGM trades inline with Las Vegas Sands and at a discount to Wynn on an earnings basis, but based on EBITDA multiple-to-growth, it trades at sharp premiums to the other two top names. MGM shares have tumbled nearly 9% today, most recently trading at $11.
Many experts are calling for a hold on the MGM shares with an expected value of only $13, personally it is believed to rise much higher, with the economic status of Las Vegas expected to rise in the tourist travel and the soon to be opened CityCenter.
Started daily holdings with 63 shares of MGM, dropped to the value of 10.76
Purchase another 55 shares of MGM.
| Positions (My Investments) | ||||||||
|
||||||||
Total Market Value: $1,281.48 |
||||||||
Total Invested – $1390.02
Ending Total Portfolio Value – $1281.48
Many experts agree that Las Vegas is set to begin a better local economic climate, and are approaching the Las Vegas stocks accordinly. Las Vegas sands is a strong buy recomendation from many analyst right now, and because of that it is begining to become over valued. The smart money is believe by us to be with MGM.
Popularity: 4% [?]
