Melco Crown Entertainment Limited (NASDAQ:MPEL) operates casino gaming and entertainment resort facilities in Asia. In order to cash in on a fast growing Philippine economy and increased tourism, Melco Crown launched its long-awaited new integrated casino resort, City of Dreams Manila. It is a part of the company’s plans to have casinos across Asia.
Meanwhile, Melco Crown earns a better part of its revenues from Macau, the only gambling destination in China. However, gambling revenues in Macau are currently slowing down due to anti-graft corruption drive undertaken by the Chinese government. China's crackdown on illegal money transfers; credit growth issues and tighter restrictions on visas have had a negative impact on revenues in this region. Also, slowdown in the Chinese economy is hurting the mass market segment.
Nevertheless, a comparatively better performance at the non-gaming segments like rooms and food and beverages, are somewhat driving revenues. Also, the company’s cost-control efforts including effective management of marketing expenses are boosting profits and margins.
Investors should note that the consensus estimate for MPEL has hardly witnessed any significant movement over the last 60 days. Meanwhile, MPEL’s earnings have been mostly strong over the past few quarters. In fact, the company posted positive earnings surprises in three of the last four quarters, with an average beat of 29.72%. Revenues, however, outpaced the Zacks Consensus Estimate in just one of the trailing four quarters.
MELCO CROWN ENT Price and EPS Surprise
MELCO CROWN ENT Price and EPS Surprise | MELCO CROWN ENT Quote
MPEL currently has a Zacks Rank #3 (Hold) but that could change following Melco Crown’s earnings report which was just released. We have highlighted some of the key stats from this just-revealed announcement below:
Earnings: MPEL beats on earnings. Our consensus earnings estimate called for earnings per share of 3 cents, and the company reported earnings of 5 cents per share. Investors should note that these figures take out stock option expenses.
Revenues: MPEL reported revenues of $1.07 billion. This missed our consensus estimate of $1.13 billion.
Key Stats to Note: Adjusted Property EBITDA was $245.3 million in the second quarter of 2016, up 19.7% year over year. The upside came mainly on the back of increased contribution from newly launched Studio City and fully-operating City of Dreams Manila.
Stock Price Impact: At the time of writing, the stock price of Melco Crown was up over 2% during pre-market trading hours following the earnings release.
Check back later for our full write up on this MPEL earnings report later!
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MELCO CROWN ENT (MPEL): Free Stock Analysis Report
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