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Analyst Report Chops Gaming Stocks

7 March 2002

BOSTON, Massachusetts -- As reported by Forbes: "Gaming stocks have become too rich for Brian Egger's blood. The Credit Suisse First Boston analyst issued a report today, titled `You've Gotta Know When To Fold 'Em,' that would make even the most incorrigible gambler balk at playing the sector.

"The report helped chop the share prices of industry bellwethers like Alton, Ill.-based Argosy Gaming (nyse: AGY), Las Vegas-based Harrah's Entertainment (nyse: HET) and Las Vegas-based Park Place Entertainment (nyse: PPE).

"Egger notes that gaming stocks, weighted by market capitalization, have had a 93% run-up since hitting their lows on Sept. 20, while the S&P 5000 grew by only 16% since its 52-week low. He also notes that consumer spending will probably stop accelerating, while corporate spending and industrial production will increase. The result? `[A] cyclical rotation away from consumer-driven stocks and into industrial cyclical equities.'

"Finally, Egger points out that Midwestern casinos--which have seen revenue increase by 12% in the past year, thanks to warm weather and the tendency of gamblers to play closer to home, will see slower growth.

"…In one of the few bright spots in his report, Egger reaffirmed his `buy' rating on MGM Mirage (nyse: MGG), raising his 12-month price target on the stock from $38 to $44. Shares are now trading at about $35.60…"

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