Harrah's Entertainment
There wasn't even a Q&A session on the earnings conference call.
There's one observation I can't resist making, though. Harrah's and Motley Fool Hidden Gems selection Ameristar Casinos
Harrah's Horseshoe Council Bluffs holds the market share lead in the Council Bluffs market, but Harrah's also has another Harrah's-branded riverboat in the market just down the street from Ameristar (all three properties are within a few blocks of each other).
Yet despite the fact that Harrah's has the market share lead in both the St. Louis and Council Bluffs markets -- and an extra casino in Council Bluffs to boot -- Ameristar still makes more money in the Missouri/Iowa region. In 2006, Ameristar pulled in a combined $225.7 million in property EBITDA at its St. Louis, Kansas City, and Council Bluffs properties, while Harrah's generated $215.5 million.
Missouri/Iowa: Harrah's vs. Ameristar Property EBITDA
2003 |
2004 |
2005 |
2006 |
Q4 '06 |
|
---|---|---|---|---|---|
Harrah's* |
$173.3 |
$198.8 |
$196.9 |
$215.5 |
$53.2 |
Ameristar** |
$194.8 |
$217.4 |
$227.4 |
$225.7 |
$56.2 |
*Includes Harrah's Maryland Heights (STL), Harrah's North Kansas City, Horseshoe Council Bluffs, and Harrah's Council Bluffs.
**Includes Ameristar St. Charles (STL), Ameristar Kansas City, and Ameristar Council Bluffs.
Harrah's did close the gap substantially with a 9% increase in property-level EBITDA in 2006, however, but Ameristar still held the EBITDA lead in Q4, and perhaps for good: Ameristar's St. Louis property is scheduled to open its AAA Four-Diamond quality hotel late in 2007, which should tip the revenue scale back the other way. Meanwhile, Ameristar could potentially recapture the lead in Council Bluffs by replacing its riverboat, while Harrah's pending sale could delay any plans for the potential construction of a hotel on the Horseshoe property.
- Betting on a Breakup at Harrah's
- $25 Billion Buyout Offer for Harrah's No Good
- Ameristar's Regional Network
- Ameristar: Is an Acquisition Imminent?
Ameristar is a Hidden Gems pick.
Fool contributor Jeff Hwang owns shares of Ameristar Casinos. The Fool has a disclosure policy.