J.P. MORGAN PESSIMISTIC ON WHAT'S LEFT OF 2008

27 June 2008

Wall Street analyst expects second half 2008 to be tough


Las Vegas land casino operators were keeping a careful eye on share prices as the week closed following depressing predictions on Las Vegas land gambling by the respected business analyst group J.P. Morgan.

The company expects the second half of 2008 to be one of the most difficult periods for Las Vegas Strip casino operators since the terrorist attacks of 2001, Associated Press reports.

Las Vegas Sands shares dropped $3.37, or 6.3 percent, to $50.01 in afternoon trading Thursday, after hitting a 52-week low of $49.65 earlier in the session. The stock has lost more than 60 percent from its multiyear high of $148.76 in October 2007.

JPMorgan analyst Joseph Greff cut his earnings estimates for Las Vegas Sands through 2011, citing "lackluster spend per visitor and stunted visitation." He said that investors may be understating the "magnitude and duration" of the challenges facing Las Vegas Strip casino operators. Greff revealed that in an attempt to attract visitors, Las Vegas Sands properties had been offering discounted room rates.

Greff said channel checks show that the second half of 2008 is likely to be one of the most challenging periods since 2001. "We expect this summer to be one of the worst on record, with meaningfully discounted room rates and special discounted package deals," he said, noting that the impact of reduced airline capacity and high gas prices is coming at a particularly bad time for the Strip.

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