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BYD YOUTUBE

In preparation for BYD's F1Q 2013 earnings release tomorrow, we’ve put together the recent pertinent forward looking company commentary.

 

BYD YOUTUBE - ff 

 

YOUTUBE FROM Q4 CONFERENCE CALL

  • Locals commentary:
    • "We saw reasons for guarded optimism in this region later in the quarter, as business trends started to improve. The declines we saw in October to November moderated in December, and that positive trend has continued into the first quarter."
    • "Customer accounts are up. Spend per visitor is down."
    • "We refined our marketing and advertising programs and made significant changes on our casino floor, and we began to see the benefits of this in the fourth quarter as visitation strengthened month-by-month across our Locals business. In 2013, we will continue looking for ways to improve our core business, not just in Nevada, but across our portfolio."
  • "As other companies in our industry have already reported, gaming customers nationwide pulled back in the fourth quarter due largely to economic uncertainty surrounding the elections and the fiscal cliff. While we actively worked to mitigate the impacts of these trends on our business, they did affect our operations. These trends continued into the first quarter. Our customers are now adapting to the impact of higher payroll taxes that took effect January 1; continued uncertainty from Washington over federal spending and taxes is affecting consumer behavior as well."
  • "We are encouraged by signs of continued improvement in the Southern Nevada economy. The unemployment rate has been declining in recent months and home prices rose substantially throughout 2012. Las Vegas is still far from the boom years, but the trend is in the right direction, and we believe we will see modest improvement throughout this business in 2013."
  • "Visitation remains solid, especially among our Hawaiian customer base, and we gained 250 basis points in market share from the third quarter to the fourth, further expanding our leading position in the Downtown market. We believe those positive trends will continue. Our Hawaiian business remains strong and we will benefit from the ongoing redevelopment of Downtown, which continues to drive new business, new visitors and new residents into the area."
  • [Midwest/South/Peninsula] "While business from our core players remained solid, we saw declines in both visitation and spending among casual players."
  • [Kansas Star] "With the permanent casino opened, the property is now on track to open a 4,200 seat arena by mid year."
  • "Looking ahead to the first quarter, Kansas Star will be comparing to a strong introductory period, when it was able to generate robust visitation with very little marketing spend. That is obviously not sustainable and customer reinvestment has increased to more realistic levels. Winter weather has presented more of a challenge in the first quarter of 2013 as well. But we remain quite optimistic about Kansas Star's long-term potential and we expect that Kansas Star's margins will remain the highest in the Peninsula portfolio and project that the property will generate about $100 million in annual EBITDA going forward."
  • "The transactions to dispose of the Echelon site and Dania will result in our leverage improving by over half a turn this year."
  • "So, regarding the property tax appeal at the Borgata, I think the only thing I can really say is it is going to trial in late March and we won't provide any commentary other than the fact it's going to trial in late March and we're hopeful of a positive outcome."

HOUSING: Raise The Roof

New Home Sales rose 1.5% this morning to 417,000 at an annual rate. This news is decidedly bullish for housing in general as home sale volumes continue to rise in tandem with home prices. Currently, new homes account for 7.8% of all sales and we expect growth to continue as inventory levels rise. The median price of new homes sold in March rose 5.3% vs the prior year, down slightly from the prior month's 5.6% year-over-year increase.

 

HOUSING: Raise The Roof - HOMESALES1

 

HOUSING: Raise The Roof - HOMESALES2

 

HOUSING: Raise The Roof - HOMESALES3

 

HOUSING: Raise The Roof - HOMESALES4

 

HOUSING: Raise The Roof - HOMESALES5


TREASURIES: How Low Can You Go?

Investors are running for the hills as the commodity bubble pops and Europe, China and gold all look weak. With people running out of places to store their money, capital is flowing into US Treasuries and in particular, the 10-Year Note. When Treasury prices go up, yields go down and that's what we've been seeing for the past month. Currently, the yield on the 10-year is at 1.65% and it's quite capable of going eve lower.

 

TREASURIES: How Low Can You Go? - 10YR


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SLOW WEEK IN MACAU

This note was originally published April 22, 2013 at 12:31 in Gaming

 

Average table revenues slowed dramatically this past week, averaging only HK$775MM per day, still up 1% year-over-year.  Our full-month projection for April is now for GGR of HK$25.5-26.5 billion, which represents year-over-year growth of +5-9%, down from our previous estimate of +11-15%.  We heard that hold may have been low this past week.

 

In terms of market share, MPEL and Sands China continue to track above recent trend.  Despite the softness this past week, we remain positive on MPEL, given its likely strong first quarter earnings report, continued market share gains, and relatively low valuation. 

 

SLOW WEEK IN MACAU - 12

 

SLOW WEEK IN MACAU - 13


Bullish TRADE! SP500 Levels, Refreshed

POSITION: 10 LONGS, 5 SHORTS @Hedgeye

 

Below 1557 (TRADE bearish); above 1557, back to TRADE, TREND, and TAIL bullish. We call that a Bullish Formation.

 

If you want to get all beared up about something, short Bearish Formations (like Commodities or Mining Stocks).

 

Across our core risk management durations, here are the lines that matter to me most:

  1. Immediate-term TRADE resistance = 1603
  2. Immediate-term TRADE support = 1557
  3. Intermediate-term TREND support = 1520

In other words, I got longer (gross and net) as we crossed and confirmed 1557. Can we snap that again? Sure. And there aren’t any rules against selling on that again either. But remember, that’s all immediate-term talk.

 

From an intermediate (TREND) perspective, both the US economy (Consumption Growth) and the SP500 continue to look bullish.

 

If the SP500 tests 1603, the VIX will probably have a 10-handle. At least that’s what my model is telling me.

 

Prepare for what most consider improbable, when it becomes more probable.

KM

 

Keith R. McCullough
Chief Executive Officer

 

Bullish TRADE! SP500 Levels, Refreshed - SPX


Big Trouble In China

China is a big economic bubble ready to pop and this morning, it's looking like it may be ready to burst. Economic activity dried up with the Chinese Purchasing Managers Index (PMI) slowing sequentially to 50.5 versus 51.6 last month. In turn, Chinese stocks, which were moving to the upside constantly back in January, are taking a turn for the worse, with the Shanghai Composite Index closing down -2.2% this morning. As you can see in the chart below, Chinese stocks have been falling since Valentine's Day. No love for China? Apparently not.

 

Big Trouble In China - shcomp


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