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R3: JCP: new look. new day. what’s new.


April 21, 2010





We spent the better part of yesterday at the JC Penney analyst day in New York. In aggregate it was solid big picture way to get a sense of where the company is heading, both near and longer term.  There weren’t any “Aha” moments or revelatory comments, but still it was worth hearing the $18 billion retailer’s senior leadership share their insights.  After about 4 hours of presentations and Q&A , management took the time to outline the company’s strategic long range financial goals and plans.  If they had released the financial part at the beginning of the meeting, then it’s likely that most analysts (at least the buy-side) would have left early, with the company’s five year guidance firmly in hand.


For us, there were actually some subtle but interesting takeaways from the “meat” of the morning.  A few points were clear.   JC Penney is working hard to position itself and its products for growth with the 25-35 year old consumer.  Almost every merchandising discussion was centered on driving traffic from this key (and elusive) demographic. Secondly, the general and free flowing use of the term “growth” was used on numerous occasions.  Growth in new stores, growth with new Sephora shops, growth with new customers, etc, etc…We got the message loud and clear.  Management believes that this is growth story.  We can’t say that we agree with that, but we can say that at least they aren’t sitting still.  More highlights and interesting callouts below:


- Lots of excitement surrounding the launch of Liz Claiborne.  Customer research shows that Liz loyalist who have shopped the brand elsewhere in the past, but who don’t shop Penney’s, plan on shopping for the brand in its new home.  The Fall launch will incorporate 30 categories across the store.  JCP sourcing gives the company a 400-500 bps gross margin advantage on Liz products, which should be accretive given the likelihood that unproductive merchandise is being shed to make room for this initiative.


- MNG by Mango is just one of the many initiatives highlighted to target the under-35 customer.  Initially the store in store concept with launch in 77 doors, ramping to 600 by Fall 2011.  What’s most interesting here is that JCP intends to flow new goods on a similar time frame as its fast-fashion partner- with deliveries and newness offered multiple times per month.  As it stands now, the fastest cycle time for any JCP line is about 12 weeks. 


- Interestingly, the company’s head of intimates admitted that her division became too focused on gross margin rate during the recession, which in turn led to less competitive pricing on national brands.  Moving forward the company aims to be competitive on price (at or below) and will be increasingly focused on gross margin dollars.  The offset to profitability will come from emphasis on private brands.


- An overriding theme across all division head presentations was reducing/editing assortments.  This is happening across all categories, on the floor and in marketing collateral.  Additionally, price points and the pricing message continues to be simplified.  “Over assortment” and “key item focus” were common buzzword used throughout the morning.


- Curiously, the American Living Brand was not mentioned at all until a question was asked about it from the audience.  Recall, that last year the meeting addressed some of the learnings from the brand’s first year and ultimately where the challenges existed for the brand.  Yesterday, CEO Mike Ullman reiterated that the launch was “ambitious” and they are more confident in the brand today.  With that said, it was clear that there is still much work to be done here and Ralph Lauren is working very closely with its JC Penney counterparts to get this right.  This Q&A dialogue was the only mention of American Living, which spans 40 categories, throughout the entire formal presentation.


- While most bricks and mortar retailers are seeing their .com subsidiaries outpace core retail growth, JC Penney is moving sideways.  Management presented strategies in which they plan to employ to reinvigorate growth in the $1.5 billion platform.  A completely revamped site will be launched in 18 months. Interestingly, JCP is trying to embrace emerging technologies in a big way and made it a point to mention “Facebook” numerous times.  In fact, JCP held its February board meeting at Facebook’s headquarters in an effort to educate its leadership on the changing and growing world of social media.  CEO Ullman sits on Starbuck’s board with Facebook’s CEO, hence the connection.


- Finally, management presented its 5 year plan to grow same store sales at a 5% CAGR, return EBIT to peak levels of 9-10%, and commensurately grow EPS at a 25% CAGR through 2014.  This is the benchmark for which the Street will judge results for the next few years.  Perhaps most interesting is the fact that the company has not posted a 5% CAGR in same store sales as far back as we can track. 


Eric Levine






- Sometimes things in retail just don’t make sense. On Coach’s quarterly conference call, management explained how goods have been distributed in Asia, ex-Japan. Essentially, product is shipped from Asian factories to Florida, and then back to Asia for resale! Good thing the company is opening an Asian distribution facility to support local growth. The new building/process is expected to take 6-8 weeks out of the supply chain process as well as likely reduce costs.


- Wolverine World Wide noted that it is seeing a noticeable shift in order patterns from its retail partners, which favors futures orders at the expense of at-once orders. Recall that this is quite the opposite of the trend we had seen for a year now, where retailers were waiting closer to need to place orders. Management believes this “order behavior” is due to two factors: 1) retailers feeling increasingly confident about the back half of the year and 2) a growing concern from retailers that Asian factory capacity may become scarce as the recovery continues and factory capacity does not come online commensurate with demand requirements.


- In her latest move to permeate the mass market, Vera Wang has signed a deal to create a bridal line for David’s Bridal. Given that Wang launched her career with great success in the high end bridal market, this should be an obvious extension of her growing fashion empire. The dresses are expected to be priced at $1500 and below, vs. her main bridal line which is priced at $6,000+.





R3: JCP: new look. new day. what’s new. - Calendar





Gap Launches Another Pant Style - On the heels of last year’s denim reboot, Gap is launching another major pants initiative. The men’s and women’s Premium Pant collection is inspired by “the big part of life that is work.” The pants will sell between $49.50 and $59.50. Anchored in tailoring, the seven women’s fits range from the Really Skinny to a slouchy Boyfit to a flared leg trouser style and the Curvy fit for fuller figures, and will be merchandised with a selection of filmy white blouses, cashmere sweaters, shearling and leather aviator jackets, as well as Pierre Hardy for Gap lace-up, peep-toe wedges. The three men’s fits include tailored khaki in straight, relaxed or slim cuts; classic khakis in straight or relaxed fits, and vintage khaki, which sports a button closure and loose, standard or straight fits. <wwd.com/menswear-news>


Kellwood Looks to Acquire - Kellwood Co.’s new revolving credit facility lets the firm take a deep breath and plunge into acquisition mode. Chief executive officer Michael Kramer said the new revolver, an asset-based loan, was closed last week. The facility is used for seasonal operating needs, with the draw-down during the year to build inventory levels, and repayment as soon as retail customers pay their bills. With its bank loan established in a still-tight credit market, Kellwood can focus on completing more acquisitions. Kellwood is looking at firms with annual volume of between $25 million and $300 million.  <wwd.com/business-news>


Skechers Gets Cartoon Animated - Skechers is developing two direct-to-DVD cartoon features, entitled "Hydee and the Hy-top" and "Twinkle Toes." The move follows its subsidiary Skechers Entertainment's deal to produce its first animated-series, "Zevo-3." <sportsonesource.com>


Mountain Lodging Occupancy Rose 9.6% in March - In some of the most solid results seen in the mountain travel industry during the past 12 months, lodging occupancy was up 9.6% y/y in March. Improving economic indicators have been credited with the recent upswing in mountain travel. The Consumer Confidence Index (CCI) increased sharply, up 13.1% in March, recovering most of February’s losses and settling at 52.5 points but remains unstable. Currently, April reservations are down 4.6% compared to April 2009 while lodging rates are up 4.2%. Has implications for outdoor brands: COLM, VFC, TBL, DECK, WWW, BOOT, etc. <sportsonesource.com/news>


Department Stores and Sports Retailers Drive March Retail Sales Increase - The average value of online orders increased to $180.95 in March, up 7.6% from $168.23 in January, according to Coremetrics. <internetretailer.com>


E-retailers Plan to Use Targeted E-mails to Improve Web Sales - 79% of retailers plan to send more targeted e-mails to customers to improve web sales, The E-tailing Group says in its 8th Annual Merchant Survey. 72% will refine site search and 70% will enhance web site merchandising. <internetretailer.com>


Indian Shoe Company to Jointly Manufacture in Bangladesh - Indian conglomerate Tata Group has signed an agreement with Nitol-Niloy to jointly manufacture shoes in Bangladesh. As per the agreement, both companies will set up a footwear factory with a daily capacity to produce 5,000 pair of shoes. Since Bangladesh has favorable trade access in Europe and North America, the new partnership aims to export the entire production from these plants there. <fashionnetasia.com>


Outdoor brand Ahnu is getting a little dressed up for fall ’10. The Alameda, Calif.-based brand (a division of Deckers Outdoor Corp.) has brought vibrant purples and soft blues and grays into its women’s line of performance wedges on boots and slip-ons, as well as added styling to its hiking product. On the men’s side, the brand is showing chukka silhouettes and rugged styles that cross over for casual use. Ahnu styles, priced between $100 and $150 at retail, are available at outdoor, independent and department stores. <wwd.com/footwear-news>


R3: JCP: new look. new day. what’s new. - Ahnu Fall Shoes




The Macau Metro Monitor, April 21rst, 2010



Steve Wynn, speaking in an interview ahead of the opening of his new hotel and casino, Encore at Wynn Macau, said construction on the Cotai project would start next year, in time to open as early as the end of 2013, and would feature a single hotel and likely include no more than 450 gambling tables. "In the past few years, Cotai players have built very ambitious projects, but they had little experience in gaming," Wynn said. "We have 42 years...and we will land on Cotai and the competition with all of that experience."


Wynn's Encore Macau is the only opening by a major casino operator this year in the Chinese territory, but it is relatively modest; the $600 million Encore Macau has 61 gambling tables, and Wynn described the project Tuesday as a "boutique hotel" meant to cater to Macau's highest-end visitors. In addition, Wynn declared his stance on a potential threat from Singaporean casinos, "Singapore as a competitive jurisdiction is irrelevant."


Wynn dismissed worries that Macau government officials could limit the number of gambling tables, calling recent remarks by top officials part of "a conversation, not a reality." "Is the table cap a fait accompli? The answer is no," Wynn said. He added that he is in regular dialogue with top Macau officials and said officials wouldn't approve projects by holders of casino licenses unless they were comfortable with the idea of more gambling tables.


Wynn called the New Jersey recommendation against Ms. Ho "ridiculous," saying regulators were overreaching to make a political statement."What has she done wrong? The fact that Stanley is her father?" Mr. Wynn said. "Pansy's as suitable as you are, except for her name. So what if a father gives money to his daughter?"


Wynn Resorts is also considering moving its global headquarters from Las Vegas to Macau, said Wynn. “It is not improbable or unrealistic considering so much of our revenue is from China that it makes sense that I spend most of my time here,” said Wynn. “I'm seriously considering that and I am weighing the implications of how I engineer that.” “What matters is not how many places get built but how good are they. The more fanciful, the more appropriate they are, they grow the market… I don't think bigger is better. I think better is better.”



Asian Coast Development Ltd. hired Lloyd Nathan, formerly president of MGM Mirage Global Gaming Development, to run the first Las Vegas-style casino in Vietnam.  Asian Coast, a Vancouver-based development group backed by Philip Falcone’s Harbinger Capital Partners LLC of New York, has a 50-year license to build a $4.2 billion casino and resort 130 kilometers from Ho Chi Minh City. MGM Mirage will manage the first property, which will be called the MGM Grand Ho Tram, Asian coast said. The first phase of the project is scheduled to open in January 2013.


Because gambling is illegal for Vietnamese, the casino will be off-limits to most of the communist nation’s 86 million people apart from overseas Vietnamese holding foreign passports. "VIP customers will account for more than two thirds of gaming revenue in the Ho Tram strip," Nathan said.


The first phase of the beach-side Vietnamese resort will include 550 rooms, 90 gaming tables and 500 slot machines, Gavin Davidson, a spokesman for Asian Coast, said in a telephone interview from Ho Chi Minh City. The development is licensed for up to 180 tables and 1,000 slot machines, he said.


The company released details of the oversubscribed ‘club loan’ syndicate deal announced on April 12 which has now been upsized to HK$9bn, meaning that the HK$14.1bn Galaxy Macau development is now fully funded.






Next Gen Mathematics

“Do not worry about your difficulties in Mathematics. I can assure you mine are still greater”

-Albert Einstein


The good news about the difficulties associated with applying chaos theory to financial markets is that it’s getting less difficult as access to information expands. That said, everything is relative. These are still very early days in terms of how governments, institutions, and individuals apply Next Gen Mathematics to managing risk in a globally interconnected marketplace.


One of the main roadblocks to successfully applying chaos theory to asset allocation models and cross-country analysis is that many fixed income and derivatives markets do not trade transparently. That is, unlike most natural systems where chaos theory is applied (like the weather), only a select group of buyers and sellers of derivative securities know whether it is sunny out or raining.


I have heard many people argue over the course of the last 72 hours that allowing derivatives to trade over-the-counter is going to “hurt liquidity.” In the short run, for the narrow marketplace of players interacting, that may very well be the case. In the long run, arguing against an expansion of markets and the subsequent reduction in costs to transact in those markets is basically arguing against transparency. In principle, and in science, I don’t buy it.


Having lost the odd toe attempting to trade everything from currencies in swap to making short sales in illiquid Chinese shell companies, I can at least tell you that one of the main reasons why a buy-sider might argue for not regulating markets is that you can make yourself a ton of money by picking off the monkeys out there who not only don’t know what they don’t know, but they can’t see someone who is supported by a multi-billion dollar cost structure.


I have worked with some hedge fund portfolio managers who are not mathematically oriented,  but by trading markets have a form of chaos theory embedded in their practitioner’s experience. They learned by doing. This is good, for them. But not for our economic system. If an asset manager finds an edge, the last thing she is going to do with that is share it with a world of wannabes looking to evolve.


Let’s consider this as a practical matter and look at how different people I have worked with consider “earnings season”:

  1. You start with a market narrative that “earnings season is going to be great”
  2. Stocks start to discount this positive expectation (SP500 up 78.6% since last year’s low)
  3. Earnings season hits, and there is price action that follows the “news”

So, a really good risk manager will consider the driving part of the Street’s story line (“earnings are going to be great”) and score that, quantitatively, relative to the price action born out of the “news.” I have seen some managers build a base of “hot” inventory that measures price moves on a 1-3 day basis into/out of news. I have seen others overlay that with volume and volatility studies. I have seen some people ignore all of the aggregated data and only focus on the stock they own.


The upshot of how all of these different personalities measure different kinds of data is the definition of chaos theory – “studying the behavior of dynamical systems that are highly sensitive to initial conditions” (Wikipedia). As opposed to waking up thinking you know exactly what is going to happen, you should wake up accepting that everything is grounded in uncertainty.


Back to the real-time example…

  1. The SP500 has rallied +15% since the initial February Freakout about Greece.
  2. The Street’s narrative is “earnings season is going to be great”
  3. Coke and IBM report earnings before yesterday’s open, and both stocks close down almost -2% on the day

So now what? What if you only follow AAPL and you are right convinced that the company is going to be the largest on the planet and that yours is a differentiated thesis that you should be paid 5 and 50 for? What if you didn’t see GS have a huge intraday reversal to the downside on big volume after a monster earnings report? What if you did see all of this and you are waking up to the following price reactions to earnings reports from last night?


A)    Trading up on earnings: TPX +10%, AAPL +5%, ALTR +5%, TUP +4%, STX +3%, TCK +3%, TSS +3%

B)    Trading down on earnings: VITC -31%, TSFG -29%, CSIQ -9%, SNV -8.%, JNPR -8%, CREE -6%, NUVA -6%, YHOO -4%, GILD -3%, PLXS -3%.


Now everything, of course, should be scored relative to the last trading price. No, that’s not the calculus the US Government uses when inflating your property taxes relative to marked-to-market trading prices of homes. It’s certainly not the ideology that Tricky Dick Fuld upheld as the written gospel of marked-to-model at Lehman Brothers. It’s just real-time math, and you need the Next Gen of Mathematics to solve for what to do.


How you interpret these real-time prices in your mathematical models relative to the one-factor we have briefly addressed (earnings season) is up to you. To me, chasing a market that has responded this poorly to earnings news because AAPL was “great” is plain reckless.


When we overlay the degradation in the earnings narrative with global risk factors like sovereign debt (Greece 10-year bond yields blasting to all time highs this morning) or the rise of short term US Treasury yields to 1.02%, this really starts to get interesting.


Don’t worry about the difficulties associated with evolving. There is much work to be done out there on the proverbial ice of market transparency, and I can assure you that my team’s issues are still greater. We know what we don’t know.


My immediate term support and resistance levels for the SP500 are now 1199 and 1214, respectively.


Best of luck out there today,



Next Gen Mathematics - AAPL


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The market’s retracement following the GS selloff is centered on the upbeat sentiment surrounding Q1 earnings season, which continues to beat analysts' expectations. 


According to Bloomberg, 82% of the S&P 500 companies that have reported first-quarter results beat the average analyst earnings estimate, up from 79.5% in the fourth quarter of 2009.  So far in 1Q, operating profit for the S&P 500 is up 35% year-over-year.  Volume declined 10% day-over-day and the VIX declined 9.2%, bringing its two day slide to 14.8%.  The Hedgeye Risk Management models have levels for the VIX at: buy TRADE (14.62) and sell TRADE (16.95). 


On the MACRO front Greek sovereign issues, China’s measures to curb real estate speculation and hawkish comments from India and the Bank of Canada are having little lasting impact on the risk/recovery trade.  Earlier today, Bundesbank President Weber's comments that Greece may need up to €80B of bail-out money is putting pressure on Greek sovereign spreads again today, rising to all time highs.


Yesterday, Energy (XLE) was the best performing sector.  The oil services group fared particularly well, with the OSX posting its biggest one-day gain since August 3rd, +4%.  The drillers and the E&P group outperformed the broader market with the EPX rising 2.1%.  In early trading, Crude is trading higher on speculation that supplies are shrinking.  The Hedgeye Risk Management model’s levels for the OIL are: buy TRADE (83.54) and sell TRADE (84.99). 


On the back of a busy day for bank earnings, the banking group provided some upside leadership for the Financials (XLF), with the BKX up 2.7% and up 11% over the past month.  The upside was largely driven by better-than-expected credit quality.  There was some disappointment surrounding results in investment banking and asset management, though the pullback was attributed to the fact that a beat was widely expected, while regulatory concerns also remained on the front-burner.


While Technology (XLK) was higher yesterday, the sector lagged the S&P 500. The big headwind came from IBM (1.9%), even though the company beat on both the top- and bottom-line and raised full-year guidance above the consensus.  On the positive side, the Semis snapped a two-day losing streak today with the SOX +1.6%.


Parts of the SAFETY trade continue to lag the market.  Healthcare and Consumer Staples were the two worst performing sectors yesterday.  The packaged food and soft-drink names were among the worst performers in the staples sector yesterday following the top-line miss from KO.  In addition, SVU was another big decliner  after becoming the latest grocer to offer disappointing guidance.


Additionally, a stronger dollar is putting some pressure on the REFLATION trade and the commodity related sectors.  The Hedgeye Risk Management models have levels for the Dollar Index (DXY) at:  buy TRADE (80.86) and sell TRADE (81.52). 


In early trading, gold is trading higher for the second day in a row on the back of its safe haven status.  The Hedgeye Risk Management models have the following levels for GOLD – Buy TRADE (1,126) and Sell TRADE (1,168).


In early trading, copper is trading slightly lower despite bullish news from China.  Copper imports by China for the month of March rose 53% over February and 14% year-over-year.  The Hedgeye Risk Management Quant models have the following levels for COPPER – Buy TRADE (3.50) and Sell TRADE (3.64).


In early trading, equity futures are trading above fair value and look continue the earnings season upside momentum.  On the MACRO front it’s a light day, but a heavy day for earnings with 35 S&P 500 companies reporting, including Morgan Stanley and Wells Fargo before the bell.  As we look at today’s set up, the range for the S&P 500 is 15 points or 0.7% (1,199) downside and 0.6% (1,214) upside. 


On the MACRO calendar today, Mortgage applications in the U.S. rose by the most in seven weeks.  The Mortgage Bankers Association’s index increased 13.6% in the week ended April 16th. Last night after the close, the ABC consumer confidence index declined to -50 from -47 the week before. 


Howard Penney

Managing Director














If it quacks like a duck...


In the breaking news department MGM MIRAGE announced they've changed their name again, this time to MGM Resorts International.  I'm not sure if this is going to help the multiple but hey it's worth a shot.  We remember other MGM incarnations:  


  • THE Las Vegas company - nobody wants to be this now
  • A Brand company - yes they have some management opportunities but fee revenue will never be close to owned EBITDA
  • A P/E stock (until the accounting for acquired intangibles leveled the playing field.  Negative earnings aren't great for P/E either)
  • Back to EV/EBITDA now that WYNN and LVS trade at a premium and the huge tax advantages of deriving most of your profits in Macau isn't captured in EBITDA
  • And most recently, a Convention company - with only 11% of room nights from conventions last year, this doesn't pass muster, but hey, Goldman signed on and the stock has moved higher


Their perception goal is pretty transparent here.  However, it doesn't really change the reality that MGM is highly leveraged to the domestic hotel casino market but with a small convention business and an even smaller international presence.


I'm guessing that 'MGM Resorts International' won out over 'MGM Conventions And Brands Worldwide' and 'Anything But Domestic Gaming Incorporated'.


Please see our 4/16 earnings preview for commentary on PENN’s upcoming quarter.  Below we highlight the important forward looking commentary from PENN’s FQ1 earnings release and conference call.




  • “Looking forward, as you can see from our guidance, we don’t see a whole lot of reason for enthusiasm in 2010.” 
  • “What we’ve done is done a lot of internal trend analysis for lack of a better description of it, which is indicating to us that the rate of decline is slowing. But rate of decline is slowing is not good news.  What that just means is it’s getting bad, it’s just getting bad slower, and we’re not on the breakneck pace to zero that we were before.” 
  • “If you take out both Penn National and Joliet, which we’re doing for internal purposes…January’s numbers – revenue numbers were down 5.3%. Now the good – if there is good… we were behind our own internal forecast up until the last weekend of the month, and then we came roaring back”
  • “Joliet, as you know, we’re operating with just the casino right now, and we don’t have much to sell there. And the competitive environment has increased in the fourth quarter. Now, labor is being managed well. We still have opportunities to be more efficient with our marketing spend there. We did open in the beginning of this week our new parking garage there. So I fully expect we’re going to see margin improvement in Joliet from what you saw in the fourth quarter”
  • “We continue to see more softness than anywhere in Southern Mississippi and Southern Louisiana.  And specifically, in Bay St. Louis, the promotional spending in that market, driven by our chief competitor in Gulfport, is deteriorating all of our margins and we’re trying to continue to find ways to protect our share, but not overspend to protect that share.”
  • “Tunica, it was a little bit different. We’ve been improving margins there. We had some unusual adjustments that negatively affected the fourth quarter in excess of $1 million of adjustments for inventory, bonus and severance, some repairs we made to the building and some increased healthcare costs. I do think those were one-time occurrences in Tunica and I don’t expect that to be a recurring theme. The promotional environment in Tunica is not like it is in Southern Mississippi.”  
  • “Charles Town, that’s one where we’re seeing some softness. We did have some weather effect in December, but even through the entire quarter, we still saw softness there in the market. And it’s an opportunity we continue to look at to improve our efficiency of our marketing spend. Again, labor is being managed well. We did see in line performance in the month of January in Charles Town, but again, we’re trying to get the right mix given the introduction of tax free promotional credits in that market to make sure that it’s as efficient use of those marketing dollars as it possibly can be and that’s the theme for Charles Town as we get into 2010 as well”
  • Answer to the impact of table games on property margins in Charles Town:  “That table tax rate is going to be 35%. So I don’t think it’s going to be enhancing our margins in Charles Town given the labor component there. I think, net-net we’re probably in the 27, 28%  area”
  • “Typically what we see across our properties are roughly 15%, table games are roughly 15% a slot, in mature markets where they both been existing sort of similar period of time. Obviously at Charles Town, what we’re expecting is that it will take some time to ramp to that level.”
  • “With the good weather and not much on TV to occupy people’s time on weekends, we continue to see reasonably good growth from our capital investment at Lawrenceburg, 8 to 9% in the fourth quarter and we had record attendance levels on Saturday.”
  • “I think the reality is this, you’ve extracted the easy stuff. The low hanging fruit has been pulled out of our cost structure. And I think as we go forward, we’re going to struggle to keep or to  basically reduce cost commensurate with revenue declines that we’re starting to get to the point where this is not as effective as we’ve been – of being able to match the revenue declines with operating cost declines.”
  • “They’re just gambling at lower threshold and you see it too and how they are playing the slot products. You see a continued trend to play the low denomination slots.”
  •  “What we’ve got for a corporate overhead number next year is around 69 million. Obviously, we continue to expect it doesn’t really have any significant amounts for lobbying. I mean there are certain amounts that we recognize we’d be spending. But it’s certainly much reduced than the current levels. The other items I mean obviously – we don’t have table games in here, because quite candidly, we don’t really have a good date for when we think it will be up and running. And the state regulatory process in Pennsylvania historically has proven to be incredibly lengthy.”
    • “So and those 69 million could be ratably throughout, let’s say, 70 million split fairly evenly throughout the year? That’s our expectation”
    • From 4/15/2010 Telsey  Conference: “I would point out that in the corporate overhead number, there’s probably – there’s almost $24 million worth of Ohio referendum costs associated with our efforts last year in Ohio.”

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