1-Star Stocks Poised to Plunge: Asia Entertainment?

Before you go, we thought you'd like these...
Before you go close icon

Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, Asia Entertainment & Resources (NAS: AERL) , which promotes VIP gaming rooms in Macau, has received the dreaded one-star ranking.

With that in mind, let's take a closer look at Asia Entertainment's business and see what CAPS investors are saying about the stock right now.

Asia Entertainmentfacts

HeadquartersWanchai, Hong Kong
Market Cap$225.8 million
IndustryCasinos and gaming
Trailing-12-Month Revenue$250.6 million
ManagementCEO Leong Siak Hung
CFO Li Chung Ming
Trailing-12-Month Return on Equity63.3%
Cash/Debt$16.7 million / $108.9 million
CompetitorsGenting Berhad

Sources: S&P Capital IQ and Motley Fool CAPS.

On CAPS, 40% of the 40 members who have rated Asia Entertainment believe the stock will underperform the S&P 500 going forward.

Just last month, one of those bears, FinerPoints, cautioned Fools about getting excited over the company's prospects:

Beware of the legitimacy of business and how they came to listing on the equity markets. Many prior "questionable" Chinese companies were here today, gone tomorrow. Buybacks are empty promises UNLESS the company acts upon them. It's usually a quick way to falsely boost stock interest and valuation.

If you want to retire rich, you need to protect your portfolio from any undue risk. Luckily, we've compiled a special free report for investors called "Discover the Next Rule-Breaking Multibagger," which uncovers a safer small-cap play with big potential. The report is 100% free, but it won't be around forever, so click here to access it now.

Want to see how well (or not so well) the stocks in this series are performing? Follow the newTrackPoisedToCAPS account.

At the time this article was published Fool contributor Brian Pacampara owns no position in any of the companies mentioned. Try any of our Foolish newsletter services free for 30 days.We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Fool's disclosure policy always gets a perfect score.

Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

Read Full Story

Want more news like this?

Sign up for Finance Report by AOL and get everything from business news to personal finance tips delivered directly to your inbox daily!

Subscribe to our other newsletters

Emails may offer personalized content or ads. Learn more. You may unsubscribe any time.

From Our Partners