Las Vegas Advisor

Posted on September 30, 2021September 26, 2023 by David Mckee — 5 Comments

Strip sizzles in August

Casinos on the Las Vegas Strip grossed $626 million last month, 20% better than August 2019. Statewide, the jump was 22% to $1.65 billion but the real overachievers were locals casinos, leaping 41% (to $250 million) with a little help from end-of-July slot revenues that were literally dumped into the early August grosses. Locals also demonstrated more resilience, down just 3% from an epic July, whereas the Strip slipped 21% month/month. Strip slot win was $358 million, a 38% vault on 26% more coin-in (plus tighter hold). Table game win—$259 million—was relatively static, up a point, on 4% higher wagering. Subtract baccarat and it looked better, 7% more win on 12% larger betting. Not that baccarat was bad: Win was down 7% and play was 8% lower, pretty good when you consider the game’s high volatility.

Posted on September 29, 2021September 18, 2023 by David Mckee — 6 Comments

Low blow

The “covidiots” have struck. Yours truly has tested positive for Covid-19, despite having been vaccinated and being generally asymptomatic. This means no trip to Global Gaming Expo, and no collection of the sights and sounds of the Las Vegas Strip. I’ll post what I can from my sickbed but it’s just not the same as being there. Sorry, folks.

Posted on September 29, 2021 by James Grosjean — 7 Comments

Colin Jones (S2 E3): Courage

In the half century since Ed Thorp published Beat the Dealer, dozens of card counting systems have been developed and promoted. Any numbers nerd with a simulator and a couch can sit there and spit out card counting systems, complete with all the technical mumbo jumbo about the method of index generation, the true-count conversion, the optimal bet ramps, and don’t forget N0. From there the posers can endlessly debate merits of one system over another, without ever even having to suck a chip out of a casino rack.

When card counters suffer huge losses, they go back to those “experts” for an autopsy. Here it comes: Should I memorize more indices? Is my bet spread okay? What is the optimal wong-out point? Is HiLo good enough? Should I play on a card so I can get a buffet and a George Foreman grill?

Posted on September 28, 2021September 14, 2023 by David Mckee — Leave a comment

Cosmo finds pigeons; Scientific sheds sports betting

Reflecting the irrational exuberance surrounding the Las Vegas Strip, it’s a done deal at The Cosmopolitan of Las Vegas. The $3.9 billion resort’s physical assets sold for $4 billion, albeit to a cloudy “group of buyers that includes a Blackstone real estate investment trust.” So there may be some jiggery-pokery at work here. The big news was that MGM Resorts International was unable to resist the dangled bait that was the Cosmo’s operating company, paying a hefty $1.6 billion and change, plus $200 million in annual rent for the plum. Our sources say Cosmo cash flow is about two-thirds of pre-pandemic levels so either MGM CEO Bill Hornbuckle is taking a big gamble or an infusion of M Life is just what the doctor ordered. Regardless, Blackstone is making out like a bandit on a property it bought for $1.7 billion back in 2014, as in $4.1 billion in windfall profits. It also reduces its exposure in its #1 market, Sin City.

Among those paying Blackstone far more than the Cosmo is worth is investment firm Stonepeak, as well as Panda Express founders Andrew and Peggy Cherng. The real winner in all this may Caesars Entertainment CEO Tom Reeg, who can ask several kings’ ransom for whichever Strip asset he chooses to put on the sell block next year (right now it’s looking like Bally’s Las Vegas). Hornbuckle and CFO Jonathan Halkyard claimed the Cosmo would expand MGM’s customer base but it’s hard to believe it isn’t the other way around. Regardless, they had to justify the megabucks they poured into a non-core asset. University of Nevada-Las Vegas boffin Amanda Bellarmino defended the splurge, saying, “The acquisition could help MGM to target younger travelers by acquiring this successful and attractive property.” (Wasn’t that what Park MGM was supposed to do?) Unlike predecessor Deutsche Bank, Blackstone knew how to run the Cosmo and the $500 million capex it put into the old gal clearly paid dividends.

Posted on September 28, 2021August 24, 2023 by Bob Dancer — 5 Comments

A Look at Double Double Bonus Poker Plus

Perhaps this is a very old game, but I just saw it for the first time recently. It looked interesting, so I thought I’d analyze it.

I was playing $5 NSU Deuces at Harrah’s Cherokee and had just hit four deuces for a $5,000 jackpot. Always nice, but it’s a once-every-5,356-hands event on average, so it’s not all that rare.

Posted on September 27, 2021September 26, 2023 by David Mckee — 1 Comment

Macao fears overdone?; Dispatches from Atlantic City

After a long bout with the flu, we’re back with our usual persiflage. One of the stocks that was on the sickbed last week was Las Vegas Sands, bedridden from proposed new restrictions on Macao casinos. Deutsche Bank analyst Carlo Santarelli put pen to paper to assure readers that the worst is behind us. His analysis “provides us with confidence that downside risk from current levels should be fairly limited, though we acknowledge, valuation in the current environment has seemingly been a function of the latest stock price, plus or minus the interpretation of the next headline, and as such, we don’t deny that the near term could be choppy.” Santarelli outlined several caveats: “we aren’t pretending to know or display confidence around our view of the potential outcomes of the Gaming Law process in Macau … we recognize the situation in Macau is uncertain, though we believe the market has taken a fairly draconian view on the potential outcomes [and] we recognize incremental investment into the Macau centric names at this time of the calendar year and with this level of uncertainty is challenging.” Still, “we believe, the medium to longer-term risk-reward is skewed favorably in LVS at current levels.”

Posted on September 25, 2021 by James Grosjean — 3 Comments

Colin Jones (S2 E2): A Brain and a Little BR

In his book The 21^st-Century Card Counter, Colin Jones talks about bankroll requirements. On page 81, in the chapter “Do I have What It Takes? The DNA of a Card Counter” he says this: “A card counter needs only two tools: a brain and a bankroll.” When I read that sentence, I almost threw an apoplectic fit. I thought, “Here it comes, this guy is going to perpetuate the myth that the main weapon of an AP—maybe even the defining characteristic—is a bankroll.” To my pleasant surprise, he then went on to dismiss that fallacy.

He writes that you need a brain, but he already dispelled the MIT Myth earlier in the chapter (as I did on page -3 of Exhibit CAA). You don’t need a great brain—me and my little brain will do just fine. Same with the bankroll. You don’t need $10k, he says—a little BR of $2k will do.

Posted on September 22, 2021September 14, 2023 by David Mckee — 1 Comment

Atlantic City slumps, as does Pennsylvania; Culinary kabuki theatre

Casinos along the Boardwalk continue to be impervious to the economic recovery that is prevalent in the gaming industry. Atlantic City was down 8% last month compared to 2019, grossing $262.5 million. Sports betting brought in $52 million (+32% from 2020) on handle of $646 million and Internet gambling generated $119 million (+29%). Terrestrial slot revenue was down 5% on 7% lower coin-in and luck was not with the house as regards table games, where revenues tumbled 18% on only 5% less wagering. Borgata got its clock cleaned (-28%), plunging 52% at the tables on 25% less drop, while slot win declined 20% on 23% less handle.

The Caesars Entertainment triumvirate slipped 13%, driven by 15% less win on 7% lower wagering, whilst slots were a bright spot, flat despite 12% less handle. Only Ocean Casino Resort and Hard Rock Atlantic City were revenue-positive for the month, with Hard Rock ($46 million) breathing down Borgata’s neck ($52 million). It gained 19% while Ocean was 38% higher than in 2019, grossing $33 million and grasping third place in the city. Caesars Atlantic City won $25 million, down 20%, Harrah’s Resort snared $28 million, off 10% and Tropicana Atlantic City ceded only 8.5% to finish at $29 million. Resorts Atlantic City did relatively well, just -2.5% down to $18.5 million, Golden Nugget swooned 23% to $16 million and Bally’s Atlantic City stumbled 17.5% to $15.5 million.

Posted on September 21, 2021August 24, 2023 by Bob Dancer — 16 Comments

Is This a Good Deal?

I’ve had a relationship with Anthony Curtis for more than 25 years. Mostly it’s a business relationship, but over the years we’ve also become friends of sorts. Not best friends, but friends nonetheless.

I received a telephone call from him at about eight o’clock one Saturday evening recently. I took the call, of course, but this was a surprise. I would definitely not be his first choice on a call like, “Hey, I’ve got an extra ticket to the Raiders game tomorrow. You interested?”

Posted on September 20, 2021September 14, 2023 by David Mckee — 8 Comments

Roundball in Sin City?

Editor’s Note: Yours truly is still on vacation, so today you’re in the capable hands of Jeff Leatherock, who ponders Las Vegas‘ emergence as a major league sports town. Enjoy!

I have been a big sports fan for 50 years. I also wound up being a fan of the business of sports for about as long. I read The $4000,000 Quarterback for the first time around 1972.

The 1960s-70s were a great time to be a young sports fan because new leagues and teams were popping up all the time and everywhere. From 1960-80 there was, on average, more than one new team added each year to the “big four” North American sports (baseball, football, basketball and hockey). Two football leagues, one basketball league, nine MLB teams. The NHL doubled in one Swell Foop in 1967, going from 6 to 12 teams, and by 1980 had 21 (!) teams. The NFL had endured the best shot of the AFL being formed and had a merger agreement with them by 1967. The attempt by the WFL to get in on the action in the early 70s was an abject failure. The ABA began their decade long war of attrition with the NBA in 1967 and ultimately staggered into the league with the Nets, Nuggets, Pacers and Spurs “allowed” to buy their way into the NBA.

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