Among the hardest hit companies in the recent market crash have been gaming stocks. The stock price for Las Vegas based casino giants has plunged. For instance, MGM Mirage had dropped 88-percent within the year.
but where some people see a free fall, others see opportunity. So should you buy?
The market drop is affecting retirement, income, and in some cases daily spending money. Still there may be deals in all of it. Analysts say stocks are the only thing we do not buy when they go on sale. The problem is finding when to jump in to make the most on your money. MGM Mirage executives say their company is grossly undervalued by the stock market.
Bridget Peters moved to Las Vegas six years ago to pursue the American dream. She has seen good times, really good times and this slow down, “I used to go out a lot more. I have toned that down a lot.”
She invested in and helped open T&T Tacos and Tequila in the Luxor this month. Peters is glad to have a job and customers buying food. Still, the economy has her watching what she spends.
“Making sure that I work more and save and watch my money — that way, so that I am not affected by it so much,” she said.
She is also looking for opportunity in addition to her investment in the restaurant. Diving into the stock market at the bottom looks more and more attractive, “It will go up and it will go down. Probably keep doing that.”
Bill Ochs says investing right now may be a smart. He owns Nevada Mortgage and has lived in Las Vegas nearly his entire life. He points to the gaming stocks. All of the major companies in Las Vegas are at historic lows.
MGM Mirage closed at $11.20 a share. Six months ago it closed at $51 a share. Las Vegas Sands, which owns the Venetian and Palazzo is at $6.32 a share. One year ago it was at $133.65. Boyd gaming sits at $4.01 a share.
“Certainly the stock and the values of stocks and some of the things you see right now and worth taking a serious look at and maybe getting involved in purchasing some of those,” he said.
He says getting in on the ground floor with a stable company will grow your money over the long term. Peters hopes that is true. So far her investment in T&T is growing as she looks at stock market opportunities. She's betting on the long term future and growth of Las Vegas which will rely on an overall economic turn-around.
Bill Ochs says the foundation of any turn around will be housing. When home values go up, people use the line of credit on their homes to make major purchases — growing the economy. It requires more jobs to make large items like cars or adding a swimming pool.
Home values dropped, credit lines were yanked, buying stopped and like a stone in a pond, the ripple effect meant job losses.