Gaming Stocks Plunge

Gaming Stocks Plunge

Leading hotel, casino and online travel companies lost nearly $10 billion in market capitalization on Monday, as investors dumped shares over concerns about a looming slump in business and leisure travel following last week’s hijackings and attacks.
Online travel agents were hit the worst, with two leading firms, Sabre Holdings Corp. (TSG.N), operator of the Travelocity Web site, and Expedia Inc. (EXPE.O) shedding 40.9 percent and 33.8 percent of their market value, respectively.

The losses easily outpaced a 4.9 percent drop for the benchmark S&P 500 index and a 6.8 percent drop for the Nasdaq index at the close of trading on Wall Street.

Sabre shares fell $16.13 to close at $23.30 and Expedia shares dropped $12.25 to $24, resulting in a combined loss of $2.7 billion in market capitalization.

The hotel industry was the next hardest hit, with the sector’s top three companies — Marriott International Inc. (MAR.N), Hilton Hotels Corp. (HLT.N) and Starwood Hotels & Resorts Worldwide Inc. (HOT.N) — losing a combined $4.8 billion in market capitalization.

Among the three, Starwood’s shares were down the most on a percentage basis, down 28.4 percent, or $8.40, to $21.15. Hilton shares closed down $2.64, or 23.6 percent, to $8.55, and Marriott shares lost $8.60, or 21.1 percent, to $32.25.

Gaming company shares were also down sharply amid uncertainty about the future for the leisure travel industry.

The nation’s top four gaming stocks — MGM Mirage (MGG.N), Mandalay Resort Group (MBG.N), Harrah’s Entertainment Inc. (HET.N) and Park Place Entertainment Inc. (PPE.N) — lost a collective $2.4 billion in market capitalization during the trading day on Wall Street.

MGM Mirage shares were down the most, losing $6.31, or 22.3 percent, to trade at $22. Mandalay shares were down $4.90, or 20.5 percent, to $19; Park Place shares were down $1.92, or 19.4 percent, to $8; and Harrah’s shares were down $4.11, or 14.3 percent, to $24.60.

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