Investment exec bullish on gaming, leisure firms’ stocks

Thursday, May 15, 2003 | 11:17 a.m.

The outlook for the stock market bodes well for Las Vegas' publicly traded casino companies, a panelist in a seminar at an investment trade show said Wednesday.

Joseph Battipaglia, executive vice president and chief investment officer of Ryan, Beck & Co. LLC, Livingston, N.J., expects leisure company stocks to perform well in the months ahead as consumer confidence rises and people begin to feel good about their jobs and about investing.

Battipaglia was one of four panelists speaking at popular television financial commentator Louis Rukeyser's "Superstar Event" at the 15th annual Money Show at Paris Las Vegas and Bally's. The show, which attracted about 8,000 registrants seeking investment advice to Las Vegas, concludes today.

The four panelists who joined Rukeyser to share views on investment strategies were unanimously bullish on the direction stock indices are headed in the months ahead.

That confidence, Battipaglia said, is one of the reasons he thinks stocks for companies that operate theme parks, cruise lines, hotels and casinos will perform well.

"I think it will happen fairly quickly," Battipaglia said in an interview following the panel discussion. "Watch for consumer confidence to pick up in an index like the (University of) Michigan (Consumer Sentiment) survey."

The Michigan survey, the most widely known of several consumer confidence indices, rebounded in April after three straight months of decline.

Battipaglia said he expects people will travel more as the public becomes more familiar with new security measures at their airports and terrorist plots are uncovered. He also said the misfortune of the severe acute respiratory syndrome outbreak overseas could be a benefit to American companies because travelers may put off trips to Europe and Asia in favor of domestic journeys.

But SARS, another panelist said, could represent one of the biggest dangers to an economic rebound and a bull-market run.

"We have no idea what (the outbreak of) SARS is going to do to the global economy," said panelist Ralph Acampora, director of technical research for Prudential Securities Inc., New York.

Another potential black cloud, said Ralph Bloch, chief market technician for Raymond James & Associates Inc., St. Petersburg, Fla., is the cost of energy.

"The cost of energy could be a severe tax on the consumer," Bloch said. "Efforts must be made to keep the price of oil down."

Bloch also said another drag on the economy could come from the high-tech sector if it continues to underperform -- something panelists don't think is going to happen.

Panelist Ned Riley, principal of State Street Global Advisors, Boston, said his biggest fear is the orchestration of a coordinated terrorist attack on U.S. soil.

"That is the one we call a show-stopper, something that could put our whole economy into a spin," Riley said.

Rukeyser, the host and editor-in-chief of "Louis Rukeyser's Wall Street," was moderately surprised that his panel unanimously predicted rebounds in the Dow Jones Industrial Average and Nasdaq and he asked each panelist to project high points in the indices and what stocks will be winners.

Technology stocks were chosen as the big winners in the months ahead, with Dell Computer Corp., Round Rock, Texas; semiconductor manufacturer Intel Corp., Santa Clara, Calif.; and communications network provider Lucent Technologies Inc., Murray Hill, N.J., making the experts' lists.

Battipaglia also said he liked biotechnology company Amgen Inc., Thousand Oaks, Calif.; industrials like copper producer Phelps Dodge Corp., Phoenix, and aluminum producer Alcoa Inc., Pittsburgh, and real estate investment trust Weingarten Realty Investors, Houston.

Acampora said he is sold on technology stocks such as Texas Instruments Inc., Dallas, and Sun Microsystems Inc., Santa Clara, Calif.; and gold producer Newmont Mining Corp., Denver.

The panelists concurred that the Dow Jones would climb to between 10,250 and 10,500 in the next year and that the Nasdaq would reach between 1,900 and 2,250 in that time frame. Wednesday, the Dow closed at 8,647.82 and the Nasdaq was at 1,534.90.