MGM Mirage (MGM) has catapulted to favorite short, ahead of Credit Bubble Stocks bellwether Winnebago (WGO), based on its dismal first quarter results that belie any claim of a recovery.
Net revenue for the first quarter of 2010 was $1.46 billion. Excluding reimbursed costs revenue mainly related to the Company’s management of CityCenter, the Company earned net revenue of $1.36 billion, a decrease of 4% from 2009.
Revenue down from first quarter 2009! After a whole year of "recovery"!
Occupancy was down to 85% compared to 87% in the year-ago quarter. Is their new property (City Center) is just cannibalizing the old ones?
When you think about it, Las Vegas gambling is a leveraged play on California discretionary/idiotic spending. Who wants to go levered long on the California middle class? Not me!
Disclosure: Short MGM and loving MGM puts.