LV resort operator’s stock hits 52-week high

Thursday, Aug. 3, 2000 | 10:33 a.m.

Shares of Mandalay Resort Group touched a 52-week high Monday, an upward move analysts say reflects optimism about the company's upcoming earnings report.

Mandalay closed Monday at $24.94, and touched $25.06 during Monday trading. On Tuesday, its shares retreated 42 cents to $24.52.

Analysts said Mandalay, which operates 26.7 percent of the hotel rooms on the Strip, stands to benefit the most from continued high demand at the city's gaming properties. Expectations are also being driven up by strong same-store cash flow growth at other Las Vegas gaming properties.

"Las Vegas continues to perform well, and they are the prime beneficiary of it," said David Anders, gaming analyst at Merrill Lynch. "(Investors) are expecting strong earnings.

"I really believe this is a fundamentals story, along with the fact that the company is using cash flow to repurchase shares, which tends to magnify performance on the (earnings per share) line."

Both Anders and Lehman Bros. analyst Stuart Linde said merger speculation, which has buzzed around Mandalay for several years, isn't the cause of the recent rally.

"Vegas is very hot, and when Vegas is really hot, this company will do very well," Linde said.