Travel Restrictions Hamstring Crown Macau
It looks like we're beginning to see how the latest round of visa restrictions on Macau visitation is affecting the bottom line of the casino companies. High roller junket operator AMAX Holdings Ltd. reported a significant decline in rolling chip volume for August 2008, which sent investors scurrying from Macau pure-play Melco Crown Entertainment LTD. (MPEL), AMAX exclusive partner.
I'm curious what kind of recourse the gaming companies have if the Chinese government's clamps start to jeopardize their ability to do business. It's hard to grow a business if you can't water the crops.
It's hard to see much downside to MPEL at $5 a pop.