Melco Crown Entertainment's ( MPEL) stock has surged more than 46% since February, leaving Wall Street wondering if any upside in the first-quarter is already factored into the stock. The Macau-based casino operator is piggybacking off strong Macau trends in March, but Santarelli believes current stock levels reflect a significant first-quarter beat and he is predicting only modest upside. "While Melco was able to grow gross gaming revenue and rolling chip volume at City of Dreams, VIP hold is likely to come in below, and potentially well below, the theoretical level," he wrote in a note. "We believe the below-theoretical hold could pressure property-level EBITDA margin, and, as such, gaming revenue flow-through to EBITDA could disappoint." Melco is scheduled to report its results on April 25, and Wall Street is predicting a profit of 5 cents a share on revenue of $807.6 million. "Despite our view that first-quarter results could take some wind out of the Melco sail, we do not view current levels as an attractive short opportunity. Melco still remains a relatively inexpensive way to play the strength in Macau," Santarelli wrote. Melco is poised for upward estimates revisions based on the recently added junkets having provided a boost in rolling chip volume at City of Dreams, and it also possesses some balance sheet flexibility, which could provide future value to equity holders, Santarelli said. Bank of America/Merrill Lynch upgraded the stock last week to buy from neutral, citing Melco's discount to its peers. Analyst Billy Ng estimates that City of Dreams could post 31% revenue growth this year and raised his price target on the stock to $11.10 from $8.