4-Star Stocks Poised to Pop: Melco Crown Entertainment
Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, casino operator Melco Crown Entertainment (NAS: MPEL) has earned a respected four-star ranking.
With that in mind, let's take a closer look at Melco's business and see what CAPS investors are saying about the stock right now.
|Headquarters (founded)||Central Hong Kong (2004)|
|Market Cap||$6.5 billion|
|Industry||Casinos and gaming|
|Trailing-12-Month Revenue||$3.27 billion|
Co-Chairman/CEO Yau Lung Ho (since March 2006)
CFO Geoffrey Davis (since April 2011)
|Return on Equity (average, past 3 years)||(3.9%)|
|Cash/Debt||$1.03 billion / $2.43 billion|
Las Vegas Sands (NYS: LVS)
MGM Resorts International (NYS: MGM)
Wynn Resorts (NAS: WYNN)
Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS.
On CAPS, 96% of the 1,342 members who have rated Melco believe the stock will outperform the S&P 500 going forward. These bulls include NEVERFADE and All-Star liszewski, who is ranked in the top 1% of our community.
A few months ago, NEVERFADE tapped Melco as a particularly attractive bet:
Little known player in the Macau market. Good valuation, good growth prospects. MPEL's House of Dancing Water is the best production in Macau per multiple reviews. Rivals Vegas' [Cirque du Soleil].
Over the past three years, in fact, Melco has grown its top line at a brisk rate of 41% annually. That's faster than other casino plays such as Las Vegas Sands (29%) and Wynn (18%), let alone MGM's annual revenue decline of 6%.
CAPS All-star liszewski elaborates on the growth opportunity:
Macau is the future of gambling and these companies are going to benefit from it. The City of Dreams is Melco's crown jewel. The revenue growth witnessed here is amazing. There is also the added bonus of potentially waking up one morning to a buyout by one of the bigger gambling names. Incremental gross gaming revenue will boost the company's profitability significantly and also reduce concerns about the casino operator's financing plan. The Chinese are becoming wealthy at an alarming pace and they aspire to spend their new found wealth. This bodes very well for MPEL, at least until we see some signs that China growth (fabricated or not) is slowing.
What do you think about Melco, or any other stock for that matter? If you want to retire rich, you need to put together the best portfolio you can. Owning exceptional stocks is a surefire way to secure your financial future, and on Motley Fool CAPS, thousands of investors are working every day to find them. CAPS is 100% free, so get started!
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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.
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