Investors contemplating the lure of casinos may want to take note as Mandalay Resort Group (NYSE:MBG), previously known as Circus Circus Enterprises, makes its second-quarter 2003 earnings announcement this afternoon.
The consensus estimate forecasts earnings of $0.63 per share from the casino operator, which runs resorts in Sin City as well as in other parts of Nevada and Mississippi, and has interests in casinos in Illinois and Michigan. First-quarter earnings were $0.69 a diluted share.
Though its flashy industry holds a certain allure during economic doldrums for people looking for an easy ticket to wealth (a ticket we all know is as far from Foolish as the state lottery), lower travel rates over the summer and overstressed bank accounts may have continued to keep some of the high rollers away.
Other issues at hand for Mandalay's financials include such states as Illinois increasing their taxation of gaming revenues, as well as a rash of insider selling after recent stock spikes.
Other wheelers and dealers in the casino industry, competing for the gambling dollar and some facing similar hurdles, include Boyd Entertainment (NYSE:BYD), MGM Mirage (NYSE:MGG), and Harrah's (NYSE:HET), all of which have faced pressures caused by war, travel jitters, and economic uncertainty.
In June, Mandalay sweetened the deal for investors by declaring a quarterly dividend to prove its "strong and reliable cash flows" (see the company press release), the first of which was paid out on August 1. Dividends are always a nice added incentive for investors. However, if you're looking to take a little less of a gamble in a dividend-paying stock, check out our new Motley Fool Income Investor newsletter.
Mandalay shares closed Friday's trading at $36.26, $0.28 higher. The stock hit a new 52-week high on August 22. Its conference call is scheduled for 4:30 p.m. ET.
