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Casino Stocks Take Hit Following Closures



Printer Friendly VersionPost a CommentTell a Friend about this Article08 July 2006
As reported by: IGaming
A dozen Atlantic City casinos have closed, resulting in a broad decline in the shares of companies with big stakes in the USA's second-biggest gambling market.
The casinos closed Wednesday morning as a result of New Jersey Gov. Jon Corzine's recent order stopping non-essential government functions as part of a budget impasse with the state Legislature.

The state regulates gambling, so with no regulators, the casinos have shut down.

The shutdown is estimated to be costing the industry $17 million a day in lost revenue, and the effect on trading has seen stocks hit in varying ways.

•Trump Entertainment (TRMP). This casino operator, which gets all its revenue from its three Atlantic City hotel casinos, suffered most as its shares sank 78 cents, or 4%, to $19.50.

•Harrah's Entertainment (HET). The biggest operator in Atlantic City, with four casinos there, saw its shares fall 74 cents, or 1.1%, to $69.76.

Harrah's shares were protected somewhat because it gets about 65% of its cash flow from properties outside Atlantic City.
Article By: IGaming

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