{"id":26317,"date":"2020-03-09T07:12:39","date_gmt":"2020-03-09T15:12:39","guid":{"rendered":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/?p=26317"},"modified":"2020-03-09T07:53:29","modified_gmt":"2020-03-09T15:53:29","slug":"panic-in-the-street-vegas-calmer","status":"publish","type":"post","link":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/panic-in-the-street-vegas-calmer\/","title":{"rendered":"Panic in The Street, Vegas calmer"},"content":{"rendered":"

A stock market “circuit breaker” was deployed for the first time since the crash of 2008, when Wall Street<\/strong> opened for trading and stocks promptly nosedived<\/a>. All major casino\u00a0stocks are trading down, especially Wynn Resorts<\/strong>, Eldorado Resorts<\/strong> and Station Casinos<\/strong>. \u201cThe market, in our view, has moved from underappreciating the risk to potentially over-penalizing the stocks,\u201d said Macquarie<\/strong> gaming analyst Chad Beynon<\/strong> earlier. The \"\"markets evidently aren’t buying the federal government’s magical thinking<\/a> about coronavirus. (Said one top official, \u201cSo if, you know, we have thousands or hundreds of thousands of people that get better, just by, you know, sitting around and even going to work\u2014some of them go to work but they get better.\u201d) According to the New York Times<\/em>, eight hours ago, there are over 500 cases of the disease in the United States<\/strong> and 22 deaths.\u00a0\u201cWhile there has been no evidence of coronavirus impacting the gaming business in the U.S. yet, the threat and fear are growing.\u00a0The outlook could shift rather quickly as it did in China<\/strong> and Macau<\/strong>,\u201d wrote\u00a0Union Gaming Group<\/strong> analyst John DeCree<\/strong>.<\/p>\n

Meanwhile Bloomberg<\/em> and Eldorado CEO Tom Reeg<\/strong> were at odds<\/a> over the ramifications of the epidemic for the Caesars Entertainment<\/strong> takeover. Reeg insisted there was “zero risk” to the high-debt buyout, despite Eldorado having set \"\"a deadline now only a few weeks away to close the deal, which may make financiers nervous.\u00a0\u201cWe feel very good about the execution that we\u2019ll get in the credit markets,\u201d Reeg responded, even though ERI shares have fallen 50% in a week. Global Gaming Business<\/em> reports that William Hill<\/strong> “expressed frustration”\u00a0at the slow resolution of Eldorado’s and Caesars’ competing sports-betting partnerships, another drag on the deal, in addition to regulatory approvals.<\/p>\n

Despite anecdotal reports of low room rates at Caesars properties, CEO Anthony Rodio<\/strong> says the company\u00a0\u201chas seen no business impact whatsoever\u201d from coronavirus, while Digital Signage Expo<\/strong> spokeswoman Geri Wolff<\/strong> wasn’t crying wolf, telling one newspaper, “This isn\u2019t the zombie apocalypse.\u201d Baccarat play is expected to take a pounding but convention bookings are holding steady for now, especially the linchpin\u00a0ConExpo-Con<\/strong>\/Agg<\/strong> show. Generally, Sin City is taking a wait-and-see attitude.<\/p>\n

Matters are less sanguine overseas, where Macao’s G2E Asia<\/strong> has been delayed until midsummer. “Our top priority is ensuring a safe environment for employees, customers, and exhibitors at G2E Asia,\u201d said Reed \"\"Exhibitions China<\/strong> COO Josephine Lee<\/strong>. Its new time will overlap with that of the rescheduled ASEAN Gaming Summit<\/strong> in Manila<\/strong>, forcing some tough choices upon attendees. ICE Asia<\/strong> (June 8-9 in Manila) is holding firm. International Game Technology<\/strong> CEO Marco Sala<\/strong> told investors, \u201cWe are monitoring its evolution closely, in Italy<\/strong> [where coronavirus is rampant] in particular. And our priority has been to ensure the wellbeing of our people and customers. The weeks ahead will be crucial in assessing its impact on our businesses.\u201d<\/p>\n

Macao casinos are already looking forward to life after coronavirus, the worst evidently behind them. Wynn Macau<\/strong>, so dependent upon high rollers, raised its junket commissions<\/a> from 40% to 42.5%. Even so, the heavy fall \"\"of the casino shutdown and visa restriction upon junketeers is expected to lead to significant\u00a0consolidation in that subsector of the industry. “[S]ince reopening we saw only very few clients and business has been really quiet,\u201d Association of Gaming & Entertainment Promoters<\/strong> spokesman Luiz Lam<\/strong> told GGR Asia<\/em>. Several hotels remain closed and while gambling has returned to Macao, revenue is expected to be terrible for sometime to come. Analysts estimate it will be 73%-85% down next month, 60% lower in April and possibly not to recover until the end of the year.<\/p>\n

Incidentally, Wildhorse Resort & Casino<\/strong> in Oregon<\/strong> is operational again after an employee tested positive for coronavirus. The casino was closed for 48 hours to enable a deep-cleaning to take place.<\/p>\n

* Taking the long view, NagaCorp<\/strong> founder Chen Lip Keong<\/strong> is sticking by plans to build a $300 million casino in the greater Vladivostok<\/strong> area. (High taxes there drove out Lawrence Ho<\/strong> but Keong is not so easily discouraged.) “I like the entrepreneurial spirit behind the development,\u201d said the billionaire. The Vladivostok region could use a dose of Keong, as it has seen all of one casino built in 10 years as a special gaming region. Things are looking up, however, as Chinese whales forsake Macao<\/strong> in favor of less-scrutinized jurisdictions. Naga Vladivostok<\/strong> is slated for a 2021 opening. Meanwhile, NagaCorp is a long-shot contender for one of Japan<\/strong>‘s three casino licenses, still a ways from being awarded.<\/p>\n

* MGM Resorts International<\/strong> has a lot of irons in the sports-betting fire, too many to summarize here. Watch:
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