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On an apples-to-apples basis, we think we are below the Street.

Our Q3 EBITDA and EPS projection is $187 million (excluding pre-opening and Maryland lobbying expenditures) and $0.57, respectively.  PENN management had previously guided to $0.55 which included pre-opening expense (estimated at $0.08) but excluded Maryland.  On an apples-to-apples basis to management’s guidance, our estimate is $0.49.  We believe consensus is somewhere below the guidance but above our estimate – again, on an apples-to-apples basis.

The whisper number is probably a slight miss.  We’re not sure how much of a catalyst a slight miss would be so guidance may be the focus.  We’re generally negative on domestic gaming.  Recent results adjusted for seasonality have been on a sequential downturn.  In other words, gaming revenue for the last three months have fallen below what the sequential trend, adjusted for seasonality, would’ve suggested.  Even if PENN maintains Q4 guidance, that guidance would be at risk, in our opinion.

Of course, PENN management has done a fantastic job with margins so that cost side will be the wild card.  We think most of the heavy lifting on cost cutting has been completed and it should be all about demand going forward.