LEISURE LETTER (02/17/2015)



  • Feb 17: HOT Conference Call on leadership change. 9:00am
  • Feb 17: MGM 4Q CC 11:00am
    • ; pw: 8870181
  • Feb 18: 
    • HYATT 4Q CC 11:30am
      • ; PW: 62845475
    • MAR 4Q release 5pm
  • Feb 19:
    • HST 4Q CC 9:00am
    • MAR 4Q CC 10:00am
      • ; pw: 41025602
  • Feb 24: GENTING 4Q CC 4:30am
  • Feb 25: 
    • SJM 4Q CC 6:00am
    • Prestige analyst day (9:00am-12pm)
  • Feb 26: RHP 4Q CC 10:00am


HOT- HOT Starwood Hotels announces CEO Frits van Paasschen to resign; Director Adam Aron appointed interim CEO. Aron will act as CEO on an interim basis while the board conducts a search for a permanent CEO that will include both internal and external candidates. van Paasschen will continue with Starwood as a consultant to assist in the transition.

Article HERE

Takeaway: Surprising development.  


BYD - The Borgata is holding a free-throw basketball tournament March 21. The $10,000 tournament has a buy-in of $20 and will consist of three rounds that are 90 seconds each. The games fall under the New Jersey First Initiative to create new gambling products ahead of other states. Borgata COO Tom Balance said the tournament is the start of the Borgata using social and skill-based gaming to target a new generation of players.

Article HERE

Takeaway:  Will skill-based slots come next?


MGM China announced a special bonus to non-management team members at MGM Macau.  The release did not specify how many workers were eligible for the payment, nor the aggregate amount involved. MGM China said only that the special bonus equals to one month’s salary and shall be paid in July 2015.  


The special bonus follows the “annual discretionary bonus" announced earlier this month, the company said, adding that non-management employees will have received total bonus equal to two months’ salary for 2014.

Article HERE

Takeaway:  2nd month bonus handed out to MGM China employees


LVS  - says it will build a $4.5 billion casino in Busan, South Korea if the government allows nationals to gamble there.  LVS has support of Busan Mayor Suh Byuing-soo.

Article HERE

Takeaway:  A long shot for LVS since it's unlikely govt will lift the local exemption. 


OPAP  - OPAP plans to open approximately 660 Play gaming halls with approximately 25 machines each, adding up to a total of 16,500 VLTs. The Agency holds licenses for 35,000 machines, but the remaining 18,500 VLTs will be provided to a series of selected subcontractors

Article HERE

Takeaway:  We have been waiting for Greece for a while. Keep an eye on how this plays out.


CCL - Carnival Cruise Line has launched a search for a new chief financial officer to succeed Anne Bramman, who is leaving after four years.

Article HERE

Takeaway:  We had just met Anne at the Vista event.


RCL - For bookings made starting Valentine’s Day through March 10, Royal Caribbean International's 'BOGO Wild' offer shaves 50% off the second passenger's cruise fare and gives on-board spending credit up to $200 per stateroom. The offer applies to bookings for an ocean-view or higher category. Plus, there are extra deals for cruises in Europe, where Royal Caribbean has eight ships sailing this summer and autumn including Anthem of the Seas and Allure of the Seas.

Article HERE


CCL - Princess Cruises’ 'Denali on Sale' offers fares as low as $99 per day with a refundable deposit. Alaska land and sea vacations combine a seven-day 'Voyage of the Glaciers' cruise including Glacier Bay National Park with a three- to eight-day land tour. The tours provide stays at Princess Wilderness Lodges and scenic rail service to the Denali area with Mount McKinley, North America’s tallest peak.

Article HERE




The Macau police forecast that the number of people crossing the border over the Lunar New Year holidays this year will be between 3-5% greater than last year.    

Article HERE




Las Vegas – Floyd Mayweather and Manny Pacquiao reportedly have finally agreed to a $250 million fight at the MGM Grand in Las Vegas.  

Article HERE

Takeaway:  Hasn't been set in stone yet but would be a positive for MGM if it happens.

Pennsylvania -  The state might consider VLTs in liquor-licensed establishments. The state’s Amusement and Music Machine Association is lobbying the House Gaming Oversight Committee to pass a bill legalizing the machines. The games could generate $1.4 billion a year which would be $500 million a year in tax money, association lobbyist John Milliron told the committee. A similar bill is already being debated in the Indiana legislature. 

Article HERE


Washington -   The gaming board has endorsed the proposal to allow Indian casinos to increase their number of slot machines by 10 percent. The proposal would allow the 27 tribes to add a total of 2,700 slot machines. They are near their current 28,000 allotment. The agreement must still be approved by the governor and legislature.


China January new home prices (0.4%) m/m vs (0.4%) in December

Annualized (5.1%) y/y vs (4.3%) in December


Singapore GDP - grew an annualized 4.9% QoQ in 4Q . That compares with a January estimate of a 1.6% gain and the median forecast of 2.2% in a Bloomberg News survey of 13 economists.


Hedgeye Macro Team remains negative Europe, their bottom-up, qualitative analysis (Growth/Inflation/Policy framework) indicates that the Eurozone is setting up to enter the ugly Quad4 in Q4 (equating to growth decelerates and inflation decelerates) = Europe Slowing.

Takeaway:  European pricing has been a tailwind for CCL and RCL but a negative pivot here looks increasingly likely in 2015.

Did the US Economy Just “Collapse”? "Worst Personal Spending Since 2009"?

This is a brief note written by Hedgeye U.S. Macro analyst Christian Drake on 4/28 dispelling media reporting that “US GDP collapses to 0.7%, the lowest number in three years with the worst personal spending since 2009.”

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7 Tweets Summing Up What You Need to Know About Today's GDP Report

"There's a tremendous opportunity to educate people in our profession on how GDP is stated and projected," Hedgeye CEO Keith McCullough wrote today. Here's everything you need to know about today's GDP report.

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Cartoon of the Day: Crash Test Bear

In the past six months, U.S. stock indices are up between +12% and +18%.

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GOLD: A Deep Dive on What’s Next with a Top Commodities Strategist

“If you saved in gold over the past 20 to 25 years rather than any currency anywhere in the world, gold has outperformed all these currencies,” says Stefan Wieler, Vice President of Goldmoney in this edition of Real Conversations.

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Exact Sciences Up +24% This Week... What's Next? | $EXAS

We remain long Exact Sciences in the Hedgeye Healthcare Position Monitor.

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Inside the Atlanta Fed's Flawed GDP Tracker

"The Atlanta Fed’s GDPNowcast model, while useful at amalgamating investor consensus on one singular GDP estimate for any given quarter, is certainly not the end-all-be-all of forecasting U.S. GDP," writes Hedgeye Senior Macro analyst Darius Dale.

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Cartoon of the Day: Acrophobia

"Most people who are making a ton of money right now are focused on growth companies seeing accelerations," Hedgeye CEO Keith McCullough wrote in today's Early Look. "That’s what happens in Quad 1."

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People's Bank of China Spins China’s Bad-Loan Data

PBoC Deputy Governor Yi says China's non-performing loan problem has “pretty much stabilized." "Yi is spinning. China’s bad-debt problem remains serious," write Benn Steil and Emma Smith, Council on Foreign Relations.

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UnderArmour: 'I Am Much More Bearish Than I Was 3 Hours Ago'

“The consumer has a short memory.” Yes, Plank actually said this," writes Hedgeye Retail analyst Brian McGough. "Last time I heard such arrogance was Ron Johnson."

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Buffalo Wild Wings: Complacency & Lack of Leadership (by Howard Penney)

"Buffalo Wild Wings has been plagued by complacency and a continued lack of adequate leadership," writes Hedgeye Restaurants analyst Howard Penney.

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Todd Jordan on Las Vegas Sands Earnings

"The quarter actually beat lowered expectations. Overall, the mass segment performed well although base mass lagging is a concern," writes Hedgeye Gaming, Lodging & Leisure analyst Todd Jordan on Las Vegas Sands.

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An Update on Defense Spending by Lt. Gen Emo Gardner

"Congress' FY17 omnibus appropriation will fully fund the Pentagon's original budget request plus $15B of its $30B supplemental request," writes Hedgeye Potomac Defense Policy analyst Lt. Gen Emerson "Emo" Gardner USMC Ret.

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