This is a cope of what I wrote on my blog this weekend I will be attending the Money Shoe in Las Vegas this weekend. Every November the money show puts on the Traders expo. I have not been to this show in the last few years now but with three stocks located in Las Vegas that I am watching I thought this years Vegas event would be well worth it. LVS, BYD and RICK all have locations in Las Vegas. While LVS and BYD are based in Vegas, LVS largest market is actually in Macau. I have been to the Sands in Macau but not the Venetian. While revenue is down in Macau the casinos are still busy and I expect that business will be at least good enough in Macau to allow all the properties to remain not only solvent but profitable. I further expect that projects being down in Macau will be able to get financing and most likely from Chinese banks. With customers coming from many locations including a large amount from Taiwan, and Japan its hard to imagine that Chinese officials will allow any of that business to migrate to Singapore that they can stop. I think it would be a foolish bet to think otherwise. Mr. Sheldon Adelson enjoys controlling interest even after the recent offering that diluted the shares. Currently Mr. Adelson has about a 51% ownership. Stock holders don't care how rich Mr. Adelson becomes but they do care about how rich the LVS stock becomes. Its no secret that the office of CEO wasn't done with fixtures from Kmart and how much share holder value is diminished from the amount of space that the office takes up. Perhaps if Vegas ever gets a baseball team they can play games in there. Despite the shortcomings, LVS is one of the few stocks that at current prices can be bought and held. It offers a large Chinese presence with American management and several high end properties in America. Another website that I do pay attention to is optionmonster.com and they are reporting (11-13-08) that based on their criteria LVS options appear to be showing a bullish signal as well. I Expect LVS to outperform the industry but I will only buy on dips. RICK is primarily in the business of operating strip bars throughout the US with its new flagship property in Vegas just opening up. RICK like the rest of the market has had its stock beaten up like they are about to fail. The statements and reporting coming out of RICK up to this date do not suggest the same. In fact RICK seems to be hitting on all cylinders and doing many things very well in a market were very few are. While RICK offers a zero yield currently, it would not be hard to imagine what a dividend would do to really send this stock higher. RICK seems to offer something for everyone. Cash flow? check, good business model? check, Profit? check, ability to expand? check. yes, in my opinion RICK is sinfully wonderful and that's were the challenge lies. unfortunately every location that RICK has a risk to ruin. Not due to market forces but rather a larger less intelligent peril. City councils, state legislatures, and all the way up to the supreme court seem to all have an opinion that changes with the wind as to what is ok and what is not. To a much lessor extent there are those that simply will not buy a company because they are against the product that they offer. Its these same perils that allow others to prosper when they correctly analyse the risks. Unlike VCGH which is another strip club chain RICK so far has not made some of the same mistakes like having a stock buyback(I will be writing a post as to why stock buybacks are almost always a poor choice). While I liquidated my RICK holdings near $13 I think at the current price of Sub $6 it may be one of the best risk to reward opportunities available in the small caps. If they can continue to execute at the current levels while adding locations BYD is the third stock that I will be spending some time looking at. In the several times that I have looked at the Orleans property I believed that they had a pretty good offering. I have been less impressed with the strip property from the quick overviews that I have seen(one should always be careful not to be too quick to judge a book by the cover though). The stock price has been hammered by the slowdown in Vegas like its a follower instead of a leader. I hope to be able to get a better sense as to the amount of accuracy the stock price is showing. So as of now I have no opinion on BYD but I will report what I find.
+ 460 for the day. ET has a rule against talking about stocks under $5 so if you want to know what I am doing check out my blog. PM if you want to know the address as I think I am not allowed to put that here either.
Rick's started as a small upscale club here in Houston...went there a few times...Anna Nicole Smith used to dance there, LOL... I think the bookkeeper is the one who recognized the potential if you operated it correctly and took it on the road.... SteveD
Today started out well with the market opening higher and I faded the QQQQs for a quick scalp. As it turns out I could have held on and would have made much more but that was not the plan going in. Normally I do not like to change the strategy while in a trade as the thought process and risk assement can be masked and clouded over from the ââ¬Ëfog of warââ¬â¢ of being in the trade. +86 Next trade had an entry based on news that Microsoft was no longer talking to Yahoo. YHOO started to tank and I followed the trend. Shorted and scalped for a nice trade although again it appears that holding longer would have resulted in greater gains. +447 Next trade again was based on news. AEM had its trading halted and upon starting up again it fell hard and fast. A little too fast in my opinion and so I went long. Traded it out to near its peak for the 15 min bars and closed out. + 336 DRYS is the next trade today. It became oversold under $6 per share and I started to fade the move down. last time I traded DRYS was actually to the long side as well based on news of a possible buyout but that turned into fools gold. This time I feel much more confident as my signals have a much better history than news trades. Holding overnight THRX was halted today and upon starting again it moved up about 20%. I faded the move up and it quickly dropped back and went below the reopen price. Was in and out of the trade rather quickly. + 212 I added a small amount to LVS even though I could have added more. With going to Vegas for the traders expo I feel like I can go go slow and actually see the place before adding more. While my observations in the course of a weekend should not have a big impact in going forward with LVS I see no harm in waiting before fully adding on the next level. Bought GE with about 5 mins of trading left in the day for scalps. Expect to close out in after market trading and in fact I sold 400 of 800 shares while typing this. + 6 (after blotter was taken) + 1089 Day + 1824 Week + 13828 Month 15200 shares 452,048 shares / mth
1R, I just caught up with your posts and I have to say this is one of the best threads I have ever read at ET. You are definitely one of the most gifted traders out there. Reading about the LEH debacle and watching you pick yourself up and get right back in the came was an invaluable lesson. Thank you for your posts. It's interesting that your worst loss came from an once-in-a-lifetime tsunami. Very few people expect LEH to fail, including its own senior employees. The world was as shocked as you were watching Bloomberg on the evening of the 14th. I read your posts as you traded LEH during the week prior to its collapse and your reasoning was sound. You traded the wrong side of an unprecedented financial event and, two months later, you have nearly recovered. There are a lot of hot shot HF managers who can't say that. Thank you again for providing such a great journal. I am looking forward to following your continued success. -gl
Hello glwatts, Wow, how do your respond to such a humbling compliment? LEH was one of the few 'jaw dropping' events that I have been faced with. To be clear, LEH is what happens when you think that your becoming bullet-proof. Had I not made multiple errors with risk management and had I not allowed myself to stray away from my trading rules LEH would have been nothing more than an interesting news story to me. Perhaps that was why it was 'easy' (if you consider talking to yourself nonstop about why you have rules and that I will take it one day at a time while getting much less sleep easy) for myself to just get back to doing what I actually do know how to do. As I respond I am in Vegas attending the traders expo as well as really taking a hard look at the LVS holdings that I currently have. The question that doesn't stop going through my mind is if I have another LEH with LVS?? I am writing a full account of my Vegas, LVS, RICK, and BYD observations on my blog and hope to be able to come up with some answers myself about the near to medium term future of gaming. Thanks again and I wish you a very happy holiday season and the best in trading. Respectfully, Bob
Due to my travels to Vegas to check out LVS, BYD and a stock that I have been asked not to list due to it being under $5 but if you want to follow you can on my blog. I have missed a couple of posts with results. 11/20/08 results + 452 Day + 2276 Week + 14280 Mth
11/21/08 results I am at the Orleans hotel in Vegas and so I am not trading today. At least I am not actively seeking out new trades but I am taking care of trades I do have on. I closed out HLX for a small gain. +27 Sold GE Dec 16 Calls against the GE shares that I expect to have put to me today. Cost of GE shares will be 15.60 net. I sold the GE calls for .55 each. Trade now has a potential profit of about $1 per share. On the way from the airport to the hotel I did try to see how busy things are here. I have been to vegas in November a few times but not within the last couple years. The taxi driver did say that it was a lot slower right now and that business was about 35% lower(not a big suprise there). He said he had been here for about 10 years. Of course one taxi driver talking on the way from an airport to a hotel doesnââ¬â¢t change the outlook as to what our understanding of LVS is unless he is saying something very different than what is expected (and then it would have to be followed up on) + 27 Day + 2303 Week + 14307 month
Day started out with C being up premarket from the government approved money being used as a backstop for some of Cs poor assets. This drove the price up to over 55% higher after the bell to a price of over $6. I shorted this move up and ended up closing out a nice gain. I did enter into C again after it recovered much of the gains it gave up. + 1269 Next trade was IDCC with at first a HL signal and then a confirming signal of 6b+. Once it crossed above 25 I started really adding a lot of short size. I did close out of some IDCC but am also holding the majority over night. + 215 + 1485 Day / Week + 14792 Month 38800 shares