Well, we always seem to be posting about how the new Asian super casinos in Macau (and now Singapore) are posting bigger and bigger numbers. The poor old lady of Las Vegas hasn´t has a look in since the credit crunch took hold. All the numbers have been heading south (except the unemployment figures that is).
So it is with great excitement that we report that the desert city might have turned the corner. You heard it here first! Since the recession, Las Vegas’ luck has sunk lower than most other US cities. (When it was good, it was very good. And when it´s bad, it´s very bad). Unemployment has hit a record high in Nevada and Las Vegas has already been overtaken as the world’s casino capital by Macau.
But hang on! The Nevada Gaming Control Board has recently reported that gambling revenue was up by 21% in June 2010 and now Harrah’s- one of the town´s gorillas- have announced an IPO to fund the completion of their projects in Vegas and Ohio. They are looking to tap the markets for almost $600m to fund the development and provide them with some liquidity.
Harrah´s, of course, have taken their first steps towards developing a presence online with a tie-up with Internet supremos 888 and Dragonfish (the B2B arm) – but it looks like this is a long term play as the US government has more pressing priorities on at the moment than regulating and legalising online gaming (Afghanistan? Quantitave Easing? Jobs?), although such a move would earn them a sackful of tax dollars.
Don´t bet against Harrah´s having a head start when things do start loosening up on the online casino and gambling regulation and licensing front in the United States. If you want to make a (long term) bet that the US market will open up to online gambling, I would buy Harrah´s shares now before it gets priced in to the shares. You could make a killing.