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Oct.29

11:32 AM ET

Monday, 29 Oct 2007

Mad Mail: Comparing Casino Stocks

Topics:Stock Market | Stock Picks | Mad Mail

Companies:Wynn Resorts, Limited | Las Vegas Sands Corp.

Dear Jim: Love the show. I live on the San Diego border and had to pack up the car to evacuate my home of 33 years because of the fires. What to take? What would I need after the fire? 'Real Money' & 'Mad Money' & the notebooks I keep of your shows and my homework. Fortunately, the fire was stalled before my street … just want you to know that my priorities are in order. Keep up the good work Jim. --Sally

P.S. During the fire I was thinking: how would Cramer make money off this event? Who owns those leased tankers that drop retardant?

Cramer says: My heart goes out to those who lost their homes and the firefighters who are doing such an excellent job.

________________

Dear Jim: Something that is puzzling me is why would the Street be willing to overpay for one stock versus another stock in the same sector? I have a position in Wynn Resorts [WYNN Loading... () ] that is trading with a 21 multiple, while Las Vegas Sands [LVS Loading... () ] is trading at a WHOPPING 143??? By comparison, LVS is expected to generate more revenue per quarter, but WYNN (in my opinion) is the better-run company. It is has higher profit margins, more growth in the immediate term and has positive cash flow. Why is the street willing to pay such a premium for LVS and not for the cheaper WYNN??? --Donovan

Cramer says: “I think you’re looking at a short-term view of LVS …They’re not that different.” WYNN has a 96 P/E and LVS has a 100 P/E.

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