Ameristar Casinos Inc.ASCA

Morningstar Rating

Stock Research and Analysis

by Michelle Chang

Ameristar Casinos possesses market-leading properties, but increased competition in some of its key sites will test the company's positions, in our opinion. We are also concerned about the company's massive debt load, which we believe will keep it in Read more

Bulls Say

Recent ballot initiatives passed in Missouri to remove loss limits and in Colorado to move to 24-hour casino operations should boost growth at Ameristar's facilities in these states.

The company's new hotel in St. Louis is one of only three hotels in the city awarded with the AAA 4-diamond rating. The all-suite hotel should give the company an advantage over competitors with lesser facilities in the region.

Ameristar is a fierce competitor. It has gained the top share in each of the markets that it has entered by spending aggressively to improve facilities and expanding marketing efforts. Read more

Bears Say

A general economic slowdown has eaten away at Ameristar's growth opportunities. With high fuel costs and declining home values, Ameristar must fight to maintain its share of consumers' discretionary spending budget.

Although entry costs in Midwestern jurisdictions are low relative to markets like Las Vegas, maintaining market share can be expensive. Ameristar must continue to make large capital and promotional investments to keep its properties fresh and fortify its competitive position.

Competition in Ameristar's markets is intensifying; the firm must wrestle with industry heavyweights such as Harrah's. Read more

Strategy

Ameristar seeks to offer the best gaming facility in each of its markets. It emphasizes Vegas-style low-limit slots, multiple dining options, well-known entertainers, and more table games than other Read more

Management

Ameristar's longtime CEO and majority shareholder, Craig Neilsen, died in November 2006. The company promoted John Boushy to the CEO role; however, Boushy resigned from this position in 2008. Gordon Kanofsky, former co-chairman of Ameristar, stepped Read more

Profile

Ameristar owns and operates seven casinos in six locations: St. Charles, Mo., near St. Louis; Kansas City, Mo.; Council Bluffs, Iowa, near Omaha, Neb.; Vicksburg, Miss.; Read more

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