Stock Picks: Casinos In Gustav's Path
As Tropical Storm/Hurricane Gustav heads for America's Gulf Coast, Susquehanna Financial Group gaming, lodging, and leisure analyst Robert LaFleur says casinos in the region are better prepared to weather the storm than they were when Hurricane Katrina came ashore.
"Mississippi changed its laws, so the casinos are not actually on the water now, they're moved back from the water," he told CNBC. "That'll be a big difference."
That said, a big storm is not actually a drawing card for the region's casino business, and LaFleur's stock picks reflect that.
"Our top pick in the space right now is Wynn Gaming," he said. "They're really a pure play on Las Vegas and Macao; they enjoy a very strong market position in Las Vegas, even though that market's got some challenges, and they've really become the dominant player in the Macao market, particularly at the high end, which is very important there."
He also likes MGM Mirage, even though the company does have some Gulf-Coast exposure.
"One property, relatively small in the global scheme of MGM Mirage," he said. "MGM Mirage is the dominant player on the Las Vegas Strip; they've got some near-term challenges, but I think, over time, that's going to be a great company."
LaFleur's firm owns shares of MGM Mirage and Wynn Gaming. The firm is also a market maker in shares of Wynn Gaming.