24/7 Wall St. » MPEL

24/7 Wall St. Closing Bell (AIG, COP, HSY, PSX, DMD, AOL, AGU, DTG, M, MPEL, TM, SODA, AMCX, MT, ESRX, MCP, JWN, NUAN, HNR, KSS, PEIX, CPWM, AMRS, ACI)

Paul Ausick — Wed, 09 May 2012 20:06:42 +0000

The major US stock indexes opened sharply lower again this morning as investors consider Greece’s commitment to the austerity measures it had previously agreed to. Renegotiating the deal seems out of the question (more coverage here) and there is even the threat that the EU will not pay the first tranche of the bailout deal when it is due tomorrow (more coverage here). US oil inventories rose last week, putting more pressure on prices today (more coverage here).The US dollar index rose today, now up 0.43% at 80.077. The GSCI commodity index is down -0.5% at 648.60, with commodities mixed on the stronger dollar. WTI crude oil closed down -0.5% at $96.71/barrel and Brent crude trades up 0.02% at $112.75/barrel. Gold settled down -0.6% today, at $1,594.20/ounce, the yellow metal’s first sub-$1,600/ounce closing since December.

The unofficial closing bells put the DJIA down nearly 97 points to 12,835.44 (-0.75%), the NASDAQ fell more than11 points (-0.39%) to 2,934.71, and the S&P 500 fell 0.67% or more than 9 points to 1,354.61.

There were several analyst upgrades and downgrades today, including American International Group Inc. (NYSE: AIG) raised to ‘buy’ at Goldman Sachs; ConocoPhillips (NYSE: COP) resumed as ‘neutral’ at Credit Suisse; The Hershey Co. (NYSE: HSY) raised to ‘buy’ at Argus; Phillips 66 (NYSE: PSX) started as ‘outperform’ at Credit Suisse; and Demand Media Inc. (NYSE: DMD) raised to ‘buy’ at Citigroup.

Earnings reports since markets closed last night have led to some price changes as of the last half hour of trading today: AOL Inc. (NYSE: AOL) is up 3.8% at $26.55; Agrium Inc. (NYSE: AGU) is down -2.2% at $82.69 (more coverage here); Dollar Thrifty Automotive Group Inc. (NYSE: DTG) is up 0.2% at $80.68; Macy’s Inc. (NYSE: M) is down -3.6% at $38.07 (more coverage here); Melco Crown Entertainment Ltd. (NASDAQ: MPEL) is down -0.2% at $13.96; Toyota Motor Corp. (NYSE: TM) is up 3.1% at $80.58; and SodaStream International Ltd. (NASDAQ: SODA) is up 28% at $37.35.

On Wednesday we are scheduled to get earnings from AMC Networks Inc. (NASDAQ: AMCX), ArcelorMittal (NYSE: MT), Express Scripts Holding Co. (NASDAQ: ESRX), Molycorp Inc. (NYSE: MCP); Nordstrom Inc. (NYSE: JWN); Nuance Communications Inc. (NASDAQ: NUAN); Harvest Natural Resources Inc. (NYSE: HNR); Kohl’s Corp. (NYSE: KSS); and Pacific Ethanol Inc. (NASDAQ: PEIX).

Other standouts from today include the following stocks:

Cost Plus Inc. (NASDAQ: CPWM) is up 21.9% at $21.92 after posting a new 52-week high earlier today. The company is being acquired by Bed Bath & Beyond Inc. (NASDAQ: BBBY) for $495 million.

Amyris Inc. (NASDAQ: AMRS) is down -21.7% at $1.98 after posting a new 52-week low of $1.89 earlier today. The biofuels and biotech company posted much higher-than-expected shortfalls in both EPS and revenues.

Arch Coal Inc. (NYSE: ACI) is up 10.1% at $8.37. The coal miner had no news today, but investors are piling in at a very low price. Volume today topped 25 million shares, more than double Arch’s daily average.

Stay tuned for Thursday. Fed Chairman Ben Bernanke and Minneapolis Fed President Naryana Kocherlakota are giving speeches. We have noted the following events on the schedule (all times Eastern):

8:30 a.m. – International trade report
8:30 a.m. – New claims for unemployment benefits
10:30 a.m. – EIA weekly natural gas storage report
1:00 p.m. – 30-year note auction
2:00 p.m. – Treasury budget
4:30 p.m. – Federal Reserve balance sheet and money supply

Paul Ausick

Filed under: General Tagged: ACI, AGU, AIG, AMCX, AMRS, AOL, BBBY, COP, CPWM, DMD, DTG, ESRX, HNR, HSY, JWN, KSS, M, MCP, MPEL, MT, NUAN, PEIX, PSX, SODA, TM

24/7 Wall St. Closing Bell (F, WYNN, COF, BP, SYNC, CHTR, HL, OMX, THC, WEN, RST, PDC, AOL, CTL, AGU, DTG, M, MPEL, NWS, CSCO, TSLA, TM, PCLN, FOSL, DNDN, AVL)

Paul Ausick — Tue, 08 May 2012 20:07:27 +0000

The major US stock indexes opened sharply lower this morning as weak performance in the European markets as traders try to figure out what last weekend’s elections mean. Crude oil was also sharply lower this morning. The three major indexes have all come back from losses greater than -1% in the afternoon, but still look set to finish the day down at least -0.5%. The US dollar index rose today, now up 0.14% at 79.716. The GSCI commodity index is down fractionally at 652.27, with commodities mixed on the slightly stronger dollar. WTI crude oil closed down -1% at $97.01/barrel and Brent crude trades down -0.23% at $112.90/barrel. Gold settled down -2.1% today, at $1,604.5/ounce, after briefly falling below $1,600/ounce earlier in the day.

The unofficial closing bells put the DJIA down more than 76 points to 12,932.01 (-0.59%), the NASDAQ fell more than 11 points (-0.39%) to 2,946.27, and the S&P 500 fell -0.43% or nearly 6 points to 1,363.71.

There were several analyst upgrades and downgrades today, including Ford Motor Co. (NYSE: F) maintained as ‘buy’ with a target price of $19 at Argus; Wynn Resorts Ltd. (NASDAQ: WYNN) maintained ‘outperform’ with a target price of $166 at Credit Suisse; Capital One Financial Corp. (NYSE: COF) raised to ‘hold’ at Argus; BP plc (NYSE: BP) cut to ‘underweight’ at Barclays; and Synacor Inc. (NASDAQ: SYNC) cut to ‘underperform’ at BofA/ML.

Earnings reports since markets closed last night have led to some price changes as of the last half hour of trading today: Charter Communications Inc. (NASDAQ: CHTR) is down up 5.5% at $65.24 after posting a new 52-week high of $66.18 earlier today (more coverage here); Hecla Mining Co. (NYSE: HL) is up 4.1% at $4.04 (more coverage here); OfficeMax Inc. (NYSE: OMX) is up 10.5% at $4.85; Tenet Healthcare Corp. (NYSE: THC) is up 1.4% at $5.11; The Wendy’s Co. (NASDAQ: WEN) is down -4.3% at $4.66 (more coverage here); Rosetta Stone Inc. (NYSE: RST) is up 18.4% at $12.64; and Pioneer Drilling Co. (NYSE: PDC) is up 5.5% at $8.03.

On Wednesday we are scheduled to get earnings from AOL Inc. (NYSE: AOL), Agrium Inc. (NYSE: AGU), CenturyLink Inc. (NYSE: CTL), Dollar Thrifty Automotive Group Inc. (NYSE: DTG), Macy’s Inc. (NYSE: M), Melco Crown Entertainment Ltd. (NASDAQ: MPEL), News Corp. (NASDAQ: NWS), Cisco Systems Inc. (NASDAQ: CSCO), Tesla Motors Inc. (NASDAQ: TSLA), Toyota Motor Corp. (NYSE: TM), and priceline.com Inc. (NASDAQ: PCLN).

Other standouts from today include the following stocks:

Fossil Inc. (NASDAQ: FOSL) is down -36.8% at $79.50. The fashion accessories company revealed a weak forecast today. More coverage here.

Dendreon Corp. (NASDAQ: DNDN) is down -24.6% at $8.81. The drug maker’s earnings were not as strong as expected. More coverage here.

Avalon Rare Metals Inc. (AMEX: AVL) is down -24% at $1.67 after posting a new 52-week low of $1.58 earlier today. The rare earths miner is delaying a feasibility study. More coverage here.

Stay tuned for Wednesday. Cleveland Fed President Sandra Pianalto and Philadelphia Fed President Charles Plosser are giving speeches. We have noted the following events on the schedule (all times Eastern):

10:00 a.m. – Wholesale trade report
10:30 a.m. – EIA weekly petroleum status report
1:00 p.m. – 10-year note auction

Paul Ausick

Filed under: General, HI/LOW, Market Close Tagged: AGU, AOL, AVL, BP, CHTR, COF, CSCO, CTL, DNDN, DTG, F, FOSL, HL, M, MPEL, NWS, OMX, PCLN, PDC, RST, SYNC, THC, TM, TSLA, WEN, WYNN

A Real Macau Win for Wynn? (WYNN, MPEL)

Administrator — Wed, 18 Apr 2012 18:34:11 +0000

Do you remember the “Do over!” SEC filing from Wynn Resorts Ltd. (NASDAQ: WYNN) a few weeks back? Everyone assumed it meant a deal was all but done, but now shares are trading higher on a weak day on speculation from a local business report that Wynn’s Macau subsidiary is about to secure a deal with the local government that would allow the luxury casino player to put in another casino on the Cotai strip. It is said that Macau may even sign as soon as this month. Investors have been expecting the news since that filing SNAFU by Wynn employees.

Macau Business reported, “Portuguese-language newspaper Jornal Tribuna de Macau quotes a source close to the project as saying that the deal could be signed before the end of this month depending on the Lands and Public Works Bureau.”

The company had previously announced that it had accepted the terms and conditions of a draft for a 25-year land concession. It does not sound like a done-done deal, but investors should have been expecting this move since that bungled SEC filing. We would always treat such reports of re-reported fake news breaks as a rumor, or even a re-rumor, until a formal press release hits the tape.

Today’s news is good for what is a 4.7% gain to $130.67 in Wynn. While this may prove to be yet one more bit of competition for Melco Crown Entertainment Ltd. (NASDAQ: MPEL), Melco Crown shares are up 3.7% at $14.86.

JON C. OGG

Filed under: Casinos, Entertainment, Luxury, Rumors Tagged: MPEL, WYNN

Top Earnings Previews For Thursday (ATVI, BG, CBOE, DNKN, EXPE, LNKD, MPEL, NUAN, PEP, PBR, PM, RSG, SIRI, SON, TDC)

Administrator — Wed, 08 Feb 2012 19:20:47 +0000

This week should be the last waves of the normalized quarterly earnings reports for companies with December 31 quarter-end dates. We are also starting to get a few of the first waves of the earnings reports from companies with off-normal quarter-ends. Wednesday is going to be another busy day with many earnings. The earnings previews are for the following: Activision Blizzard Inc. (NASDAQ: ATVI); Bunge Ltd. (NYSE: BG); Carbonite Inc. (NASDAQ: CARB); CBOE Holdings Inc. (NASDAQ: CBOE); Dunkin’ Brands Group Inc. (NASDAQ: DNKN); Expedia Inc. (NASDAQ: EXPE); LinkedIn Corporation (NYSE: LNKD); Melco Crown Entertainment Ltd. (NASDAQ: MPEL); Nuance Communications Inc. (NASDAQ: NUAN); PepsiCo Inc. (NYSE: PEP); Petroleo Brasileiro (NYSE: PBR); Philip Morris International Inc. (NYSE: PM); Republic Services Inc. (NYSE: RSG); Sirius XM Radio Inc. (NASDAQ: SIRI); Sonoco Products Co. (NYSE: SON); and Teradata Corporation (NYSE: TDC).

We have compiled earnings preview on each company using Thomson Reuters consensus estimates and added color on each if applicable. Some of these are market moving, some are sector moving, and some are just interesting for traders to watch around the earnings reports.

Activision Blizzard Inc. (NASDAQ: ATVI) estimates are $0.56 EPS and $2.2 billion in revenues. At $12.55, the maker of World of Warcraft has been very range bound.

Bunge Ltd. (NYSE: BG) estimates are $1.57 EPS and $13.73 billion in revenues.

Carbonite Inc. (NASDAQ: CARB) estimates are -$0.23 EPS and $16.78 million in revenues. This will be a first real look of a full quarter and unfortunately this one has been cut in half as investors have tempered expectations for the personal data backup service provider.

Filed under: 24/7 Wall St. Wire, Calendar, Earnings Tagged: ATVI, BG, CBOE, DNKN, EXPE, LNKD, MPEL, NUAN, PBR, PEP, PM, RSG, SIRI, SON, TDC

Top Analyst Upgrades & Downgrades (CELL, CSCO, DECK, DO, FTE, HTS, HWAY, HERO, LVS, LULU, MPEL, NRG, PM, SLB, SAH, STFC, VE, VRSN, WFT, YUM)

Administrator — Thu, 08 Dec 2011 13:21:30 +0000

These are some of the top analyst upgrades, downgrades, and initiations seen from Wall Street research calls this Thursday morning.

Brightpoint Inc. (NASDAQ: CELL) Reiterate as Buy with a $14 price target objective at Canaccord Genuity.
Cisco Systems Inc. (NASDAQ: CSCO) Reiterated as Buy with $24 price target objective at Argus.
Deckers Outdoor Corporation (NASDAQ: DECK) Reiterated as Buy with a $122 price target objective at Canaccord Genuity.
Diamond Offshore Drilling Inc. (NYSE: DO) Started as Sell with a $70 target price objective at Goldman Sachs.
France Telecom (NYSE: FTE) Cut to Underperform and named as Bear of the Day by Zacks Investment Research.
Hatteras Financial Corporation (NYSE: HTS) Cut to Neutral at Stern Agee.
Healthways Inc. (NASDAQ: HWAY) Raised to Buy at Stifel Nicolaus.
Hercules Offshore, Inc. (NASDAQ: HERO) Started as Neutral at Goldman Sachs.
Las Vegas Sands Corp. (NYSE: LVS) Cut to Neutral at Janney Capital Markets.
Lululemon Athletica Inc. (NASDAQ: LULU) Reinitiated as Buy at Stern Agee.
Melco Crown Entertainment Ltd. (NASDAQ: MPEL) Raised to Outperform from Neutral at Credit Suisse.
NRG Energy, Inc. (NYSE: NRG) Cut to Neutral from Buy at UBS.
Philip Morris International, Inc. (NYSE: PM) Cut to Neutral from Buy at Nomura.
Schlumberger Limited (NYSE: SLB) Started as Neutral at Goldman Sachs.
Sonic Automotive, Inc. (NYSE: SAH) named as value stock of the day by Zacks Investment Research.
State Auto Financial (NASDAQ: STFC) Raised to Buy from Neutral at Janney Capital Markets.
Veolia Environnement S.A. (NYSE: VE) Cut to Hold from Buy at Deutsche Bank.
VeriSign, Inc. (NASDAQ: VRSN) Raised to Outperform and featured as the Bull of the Day by Zacks Investment Research.
Weatherford International Ltd. (NYSE: WFT) Started as Buy with a $22 price target objective at Goldman Sachs.
Yum! Brands, Inc. (NYSE: YUM) Reiterated Buy with $65 fair value target at Janney Capital Markets.

JON C. OGG

Filed under: Analyst Calls Tagged: CELL, CSCO, DECK, DO, FTE, HERO, HTS, HWAY, LULU, LVS, MPEL, NRG, PM, SAH, SLB, STFC, VE, VRSN, WFT, YUM

24/7 Wall St. Top Analyst Calls of the Week (ALU, AMZN, AAPL, CSCO, CSC, CXW, DF, EPD, GNW, GMCR, GRPN, HD, MPEL, PIR, SRDX, TEVA, VRTX, YRCW, ALIM)

Administrator — Sat, 12 Nov 2011 14:19:38 +0000

Each morning 24/7 Wall St. issues a summary list of key analyst upgrades, downgrades, and initiations issued by Wall Street research firms. We review these calls and other calls made throughout the week to see which stand out the most. Some are great calls that were full of insight, while others were total flops. After reviewing and filtering all of these research reports, we end up with the top analyst calls of the week.

We had many key calls that stood out this week in shares of the following: Alcatel-Lucent SA (NYSE: ALU); Amazon.com Inc. (NASDAQ: AMZN); Apple Inc. (NASDAQ: AAPL); Cisco Systems Inc. (NASDAQ: CSCO); Computer Sciences Corporation (NYSE: CSC); Corrections Corporation of America (NYSE:CXW); Dean Foods Company (NYSE: DF); Enterprise Products Partners LP (NYSE: EPD); Genworth Financial Inc. (NYSE: GNW); Green Mountain Coffee Roasters Inc. (NASDAQ: GMCR); Groupon, Inc. (NASDAQ: GRPN); The Home Depot Inc. (NYSE: HD); Melco Crown Entertainment Ltd. (NASDAQ: MPEL); Pier 1 Imports, Inc. (NYSE: PIR); SurModics Inc. (NASDAQ: SRDX); Teva Pharmaceutical Industries (NASDAQ: TEVA); Vertex Pharmaceuticals Incorporated (NASDAQ: VRTX); and YRC Worldwide. Inc. (NASDAQ: YRCW).

We have broken each of these calls out and added in color where applicable.

Alcatel-Lucent SA (NYSE: ALU) can’t get off the floor and it keeps disappointing. Shares even closed at $1.99 after seeing a year low of $1.92 on Friday. Alcatel’s chart looks almost the same as the chart of late-2008, but it cannot blame the market this time. We saw three downgrades worth noting this last week: Cut to Sell at Citigroup; Cut estimates and target at Argus; and Cut to Neutral at BofA/Merrill Lynch.

Amazon.com Inc. (NASDAQ: AMZN) had two big calls this last week. The main call was on Friday when Nomura issued a very unenthusiastic NEUTRAL rating. The other call came on Thursday when Zacks added it to the STRONG SELL list. With valuations still very high and with profit margins running razor-thin, it seems that at least some caution should prevail unless the holiday season is going to blow the doors of the hinges here.

Filed under: Analyst Calls, Research, The Week Tagged: AAPL, ALIM, ALU, AMZN, CSC, CSCO, CXW, DF, EPD, GMCR, GNW, GRPN, HD, MPEL, PIR, SRDX, TEVA, VRTX, YRCW

24/7 Wall St. Closing Bell (AMZN, CAM, MPEL, NVDA, SVU, RF, DDS, DHI, BONE, CDTI, HHC, PNS, ALIM, PSDV, MCP, HOVNP, TRX)

Paul Ausick — Fri, 11 Nov 2011 21:08:57 +0000

The markets got off to a strong start this morning, and stayed that way throughout the day. The dollar weakened against the euro and yen as currency traders seem to believe that a solution to the mess in Europe is getting nearer. Trading volume has been moderate today, perhaps due to the bond market holiday. Gold closed at $1,788.10/ounce, up 1.6% and silver closed near $34.69/ounce, up 1.7%. Crude oil settled within just below $99/barrel, its highest point in about three months.

The unofficial closing bells put the DJIA up more than 259 points to 12,153.46 (2.18%), the NASDAQ rose more than 53 points (2.04%) to 2,678.75, and the S&P 500 rose 1.95% or more than 24 points to 1,263.85.

There were several analyst upgrades and downgrades today, including Amazon.com Inc. (NASDAQ: AMZN) started as ‘neutral’ at Nomura. Other changes included Cameron International (NYSE: CAM) reiterated ‘buy’ with $73 target at BofA/ML; Melco Crown Entertainment Ltd. (NASDAQ: MPEL) maintained ‘neutral’ but cut target to $14 at JPMorgan; NVIDIA Corporation (NASDAQ: NVDA) reiterated ‘buy’ with $18 target at BofA/ML; SUPERVALU Inc. (NYSE: SVU) reinstated as ‘neutral’ at BofA/ML; and Regions Financial Corporation (NYSE: RF) started as ‘outperform’ at BMO Capital.

Here are today’s big post-earnings news reactions with prices during the last half-hour of trading: Dillard’s Inc. (NYSE: DDS) is down more than -13%, at $47.91; D.R. Horton, Inc. (NYSE: DHI) is down more than -2%, at $11.42; Bacterin International Holdings, Inc. (NASDAQ: BONE) is up more than 6%, at $2.90; Clean Diesel Technologies, Inc. (NASDAQ: CDTI) is down more than -3.5%, at $3.45; and The Howard Hughes Corp. (NYSE: HHC) is up more than 2.5%, at $47.25.

Several other standouts from today are as follows…

Pinnacle Data Systems Inc. (AMEX: PNS) is up more than 105%, at $2.36. The company has accepted a takeover offer from Avnet, Inc. (NYSE: AVT) worth $2.40/share.

Alimera Sciences, Inc. (NASDAQ: ALIM) is down nearly -74%, at $1.94. The company failed to get FDA approval for its eye pain drug.

pSivida Corp. (NASDAQ: PSDV) is down more than -46%, at $2.11. The company had licensed to Alimera an element of the drug that failed the FDA test.

Molycorp, Inc. (NYSE: MCP) is down more than -13%, at $33.43. The company missed earnings and revenue estimates.

Hovnanian Enterprises Inc. (NASDAQ: HOVNP) is down more than -9%, at $1.40. The company did not have any news today, but likely suffered from the earnings report from D.R. Horton.

Tanzanian Royalty Exploration Corp. (AMEX: TRX) is up more than 20%, at $2.75. The company’s shares were halted earlier, and the company issued a statement that there was no particular event responsible for the heavy trading in the stock.

Except for short-term Treasury Bill auctions, there are no events scheduled for Monday.

Paul Ausick

Filed under: HI/LOW, Market Close Tagged: ALIM, AMZN, BONE, CAM, CDTI, DDS, DHI, HHC, HOVNP, MCP, MPEL, NVDA, PNS, PSDV, RF, SVU, TRX

Top Analyst Upgrades & Downgrades (AMZN, AMAT, SAM, CAM, CIM, GNW, MHR, MPEL, NVDA, PKD, PLSX, RF, SVU, UTHR, ZMH)

Administrator — Fri, 11 Nov 2011 13:21:17 +0000

These are some of Friday’s top analyst upgrades, downgrades, and initiations seen from Wall Street research calls.

Amazon.com Inc. (NASDAQ: AMZN) Started as Neutral at Nomura.
Applied Materials Inc. (NASDAQ: AMAT) Started as Neutral with $13 target at Credit Suisse.
Boston Beer Company (NYSE: SAM) named Momentum stock of the day at Zacks.
Cameron International (NYSE: CAM) Reiterated Buy with $73 target at BofA/ML.
Chimera Investment Corporation (NYSE: CIM) Raised to Neutral at Stern Agee.
Genworth Financial Inc. (NYSE: GNW) Raised to Neutral at Citigroup.
Magnum Hunter Resources (NYSE: MHR) reiterated Buy and raised target to $8.00 at Canaccord Genuity.
Melco Crown Entertainment Ltd. (NASDAQ: MPEL) maintained Neutral but cut target to $14 at JPMorgan.
NVIDIA Corporation (NASDAQ: NVDA) Reiterated Buy with $18 target at BofA/ML.
Parker Drilling Company (NYSE: PKD) named value stock of the day at Zacks.
Plexus Corporation (NASDAQ: PLXS) named Bear of the Day at Zacks.
Regions Financial Corporation (NYSE: RF) Started as Outperform at BMO Capital.
SUPERVALU Inc. (NYSE: SVU) Reinstated as Neutral at BofA/ML.
United Therapeutics (NASDAQ: UTHR) Raised to Outperform as Bull of the Day as Zacks.
Zimmer Holdings Inc. (NYSE: ZMH) Cut to Hold at Argus.

JON C. OGG

Filed under: Analyst Calls Tagged: AMAT, AMZN, CAM, CIM, GNW, MHR, MPEL, NVDA, PKD, PLSX, RF, SAM, SVU, UTHR, ZMH

Chanos Keeps Shorting China… and Winning (FXI, GXC, TAO, CHN, TDF, MPEL)

Administrator — Wed, 21 Sep 2011 11:56:47 +0000

Fund manager Jim Chanos has been pretty vocal about the risks in China from its economy to its debt levels to its real estate market. He goes on to say that real growth in China now may be zero and he equates the implied debt levels to that of burdened European nations.

If you invest in companies with high exposure to China, this might matter. If you invest in key ETFs like iShares FTSE/Xinhua China 25 Index (NYSE: FXI), SPDR S&P China (NYSE: GXC), and Guggenheim China Real Estate (NYSE: TAO) or if you prefer closed-end funds like The China Fund, Inc. (NYSE: CHN) or Templeton Dragon Fund Inc. (NYSE: TDF) then this really matters. Keep in mind that Jim Chanos has been bearish on China for some time. The problem is that with things slowing elsewhere the issues at hand could be coming to a real head. These funds and ETFs are generally down about 25% from year highs and most are closer to their lows of the last year.

Chanos recently spoke to Carol Massar on Bloomberg TV in this video.

On the debt issue… “The Chinese government’s balance sheet directly does not have a lot of debt. The state-owned enterprises of the local governments and all the other ancillary borrowing vehicles have lots of debt and its growing at a very fast rate. The assumption is that the state stands behind all this debt. We see that the debt in China, implicitly backed by the Chinese government, probably has gone from about 100% of GDP to about 200% of GDP recently. Those are numbers that are staggering. Those are European kind of numbers if not worse.”

The property bubble… “I think that will be the surprise going into this year, and into 2012 – that it is not so strong. The property market is hitting the wall right now and things are decelerating. The CEO of Komatsu said last week that he is having trouble getting paid for his excavator sales in China. Developers are being squeezed. They’re turning to the black market for lending, this shadow banking system that is growing by leaps and bounds like everything in China.

“Regulators over there are really trying to get their hands around the problem. In the meantime, local governments have every incentive to just keep the game going. So they will continue with these projects, continuing to borrow as the central government tries to rein it in.”

What Chanos is shorting… “We are short Chinese banks, the property developers, commodity companies that sell into China, anything related to property there is still a short.” Oddly enough, Melco Crown Entertainment Ltd. (NASDAQ: MPEL) might be an indirect winner as Chanos is long the Macau casinos which are growing at a faster rate even than the property developers.

Chanos also outlined an IMF downgrade to China’s growth he outlined tha the write-offs make China’s 9% growth really about zero.

Chanos has been shorting China for some time and a recent CNBC video shows more on the matter. Oddly enough, in August the Asian sector funds netted in a half-billion dollars in inflows.

JON C. OGG

Filed under: ADR, China, Emerging Markets, Financial Stocks, International Markets, Interview, Mutual Funds, Personal Finance Tagged: CHN, FXI, GXC, MPEL, TAO, TDF

Melcro Crown: How Macau Is An Earnings Haven (MPEL, WYNN, LVS)

Administrator — Tue, 23 Aug 2011 14:03:11 +0000

There is a trend happening about gambling in Asia, and it no longer just involves Asian businessmen flying to Las Vegas. This is about Macau, and the pure-play for Macau is Melco Crown Entertainment Ltd. (NASDAQ: MPEL).

The Macau casino has already migrated from the development stage to the revenue stage of its business, and shareholders are getting more and more used to the company reporting positive earnings each quarter.

Melco Crown’s revenue in the second quarter of 2011 was $960.0 million, up 67% from a year earlier. The company even reported positive earnings on GAAP basis of $0.13 EPS (or $66.7 million) versus a loss of -$0.06 EPS (or -$30.1 million) a year ago.

Here is what is driving the gains… “improved rolling chip volumes, normalized rolling chip win rates at City of Dreams, continued strong growth in mass market and hotel operations at City of Dreams, as well as contributions from other non-gaming amenities such as The House of Dancing Water and Club Cubic.”

What is interesting about Melco is that its $6+ billion value makes it far smaller than Macau (and Vegas) rivals Las Vegas Sands (NYSE: LVS) for its Sands China and Wynn Resorts Ltd. (NASDAQ: WYNN) for its Wynn Macau. Analysts spent much of July chasing the shares higher and higher with price targets and the $15.55 consensus price target from Thomson Reuters is actually low considering the upgrade cycle seen in the last six-weeks. Shares peaked at $16.15 this year and now the stock is back to $12.10 after a 3.5% gain today.

Another interesting development is that Melco Crown applied for a dual-listing with the Hong Kong stock over the last month.

Melco Crown operates three casino projects in Macau and it recently completed the acquisition of a 60% interest in the Studio City project on Cotai, which is aimed to expand its current portfolio of gaming assets in Macau.

So, the big question is how the analysts will treat Melco CRown in the coming days. They were stepping all over each other to raise their targets earlier this summer. The stock slid almost 20% before earnings in just the last few days, mostly due to fears that Asian businessmen would crimp their gambling budgets as times get a little less fruitful.

Our take is that no one is immune, but our take is also that Macau still has ample room for growth. Macau has come along way from what was left over of the Portuguese colony. Investors are looking for “haven investments” that offer either growth or income (or both).

It is too soon to ask for Melco Crown to pay a dividend and casinos have historically not been big dividend outlets for investors. Still, Macau has enough room for growth ahead of it that this may still represent a haven for investors.

JON C. OGG

Filed under: ADR, Casinos, China, Earnings, Emerging Markets, International Markets Tagged: LVS, MPEL, WYNN