(Associated Press) NEW YORK — Disappointing results from two of Melco Crown Entertainment Ltd’s Macau casinos led a JPMorgan analyst to withdraw the casino developer’s price target and lower some of his estimates Tuesday.
The Hong Kong-based company, which develops and owns Macau casino resorts, had a “very poor” June VIP hold of 0.8 percent at its City of Dreams complex, according to analyst Carlo Santarelli. The hold is the amount won by the casino as a percentage of the total wagered.
The $2.1 billion City of Dreams – which has three hotels, more than 500 gambling tables, Las Vegas-style shows, an upscale shopping mall and restaurants – opened in Macau on June 1. Macau is the only place in China with legalized gambling.
At the Altira Macau, the rolling chip hold percentage, which measures VIP play, was a lackluster 2 percent.
Santarelli said the results, combined with a likely slow ramp-up at City of Dreams, prompted him to reduce his second-quarter estimate to a loss of 13 cents per share from a loss of 4 cents per share. He revised his 2009 forecast to a loss of 29 cents per share from a loss of 17 cents per share and lowered his 2010 estimate to a loss of 20 cents per share from a loss of a penny per share.
Analysts surveyed by Thomson Reuters forecast a second-quarter loss of 12 cents per share, 2009 loss of 22 cents per share and 2010 profit of 22 cents per share. Analysts’ estimates generally exclude one-time items.
Santarelli withdrew Melco’s $5 price target but maintained its “Neutral” rating.
Shares of Melco Crown Entertainment added 3 cents to $4.59 in morning trading.
