Updated from 9:08 a.m. EDT
shares gained Tuesday after the company beat Wall Street expectations, reporting a sharp increase in third-quarter profit, driven by growth in the Las Vegas economy.
Station, which primarily targets local residents at its Las Vegas casinos and hotels, reported net income of $29.1 million, or 43 cents a share, up 46.9% from $19.8 million, or 32 cents a share, a year earlier.
Excluding non-recurring items, Station earned 46 cents a share, up from 35 cents a year earlier and better than the 44-cent consensus forecast of analysts.
Station was up $1.56, or 3.2%, to $49.73.
Total revenue was $242.9 million, up 11.1% from $218.7 million in the year-ago quarter and greater than the $238.8 million Wall Street forecast. Top-line growth was driven by Las Vegas results.
Revenue from Las Vegas casinos that were open a year ago jumped 14% annually, with EBITDA, or earnings before interest, taxes, amortization and depreciation, margins of 36.3%, up from 32.5% a year before.
"Our third consecutive quarter of double-digit same-store revenue growth demonstrates the strength of the Las Vegas economy," said Glenn Christenson, Station's chief financial officer. "We continue to benefit from significant population growth and substantial development in the community, including new housing. These factors, combined with no new supply in the locals' market, give us confidence in our guidance of 10% to 12% same-store revenue growth for the fourth quarter of 2004."
In its third-quarter release, the company said it now expects earnings per share of 48 cents to 52 cents in the fourth quarter, compared with the average analyst estimate for 48 cents. For all of 2004, Station now expects earnings per share between $1.94 and $1.98, compared with a $1.95 analyst consensus and the $1.87 to $1.97 range the company provided in September.
When it reported second-quarter results in July, Station disappointed investors by lowering guidance below Wall Street estimates. Last month, it revised estimates back up.
Station also declared a 20% increase in its quarterly cash dividend; the next dividend will be 21 cents a share, payable on Dec. 3.
Look for other major casino groups
to report results before the bell Wednesday. On average, analysts estimate EPS of $1.04 for Harrah's and 57 cents for MGM Mirage.