Analyst downgrades shares

Friday, Nov. 8, 2002 | 11:14 a.m.

Wall Street firm Deutsche Bank Securities has downgraded shares of Las Vegas Strip casino resort operator Mandalay Resort Group from "buy" to "hold" on concerns about weakening consumer spending and room rate pressure on mid- to lower-level properties in Las Vegas.

"With more than 12,000 tour-and-travel (and independent tourist) oriented rooms in the mid/value market, we believe Mandalay in particular is feeling this pricing pressure," analyst Marc Falcone noted.

In general, Las Vegas' premium properties such as Bellagio, The Mirage, The Venetian and Mandalay Bay "continue to realize better pricing than mid-market properties given their high-quality amenities, rooms and mix of convention business," he said.

"In this respect, we believe that MGM MIRAGE remains better positioned in the current operating environment."

Mandalay shares fell $1.38 to $28.62 Thursday, but remain well above their 52-week low of $18.72.

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