NEW YORK (
) -- Casino stocks are rallying along with the rest of the market, as the sell-off last week created a prime buying opportunity.
But the run-up isn't totally unwarranted. For one, Atlantic City reported some stabilization in gaming, as revenues slipped just 0.7% to $311.5 million in April -- representing the best-year-over year performance since August 2008. In particular, the Borgata -- which is co-owned by
-- posted a 2.4% uptick.
MGM surged 6.7% to $14.00, while Boyd ended the day up 3.5% to $12.39.
Last week, MGM reported a loss in its first quarter, but said that convention and bookings were improving in the second half of the year and headed into 2011.
The biggest percentage gainer in the sector was Macau-based
Melco Crown Entertainment
, which advanced 11.3% to close at $4.25. Last week the Chinese gambling enclave said gaming revenue hit a record high in April, spiking 70% to $1.76 billion.
Elsewhere in the casino sector,
Las Vegas Sands
declared a quarterly dividend of $2.50 a share on preferred stock. The dividend is payable on May 17 to shareholders of record on May 4.
Shares of Sands soared 9.7% to close on Monday at $23.25.
"Prior to the market correction, casino names were demonstrating deserved strength off of improving domestic indicators and continuing record strength in Macau," Sterne Agee analyst David Bain said. "The one area of complaint from investors was in the valuation arena or, like one investor stated to me, 'I like the names, but stocks look a bit frothy.' To this end, the market pull-back created some buying opportunities for those that desired exposure at lower prices, especially now that the broader indexes seem to be rebounding."
-- Reported by Jeanine Poggi in New York
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