Melco Crown Entertainment Ltd (MPEL): Today's Featured Services Laggard

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model

Melco Crown Entertainment ( MPEL) pushed the Services sector lower today making it today's featured Services laggard. The sector as a whole closed the day up 0.2%. By the end of trading, Melco Crown Entertainment fell $0.97 (-4.1%) to $22.49 on heavy volume. Throughout the day, 7,416,143 shares of Melco Crown Entertainment exchanged hands as compared to its average daily volume of 3,792,300 shares. The stock ranged in price between $22.00-$23.82 after having opened the day at $23.60 as compared to the previous trading day's close of $23.46. Other companies within the Services sector that declined today were: Pharmerica Corporation ( PMC), down 16.7%, Sport Chalet ( SPCHA), down 14.1%, Mandalay Digital Group ( MNDLD), down 13.4% and Mandalay Digital Group ( MNDL), down 13.4%.
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Melco Crown Entertainment Limited, through its subsidiaries, develops, owns, and operates casino gaming and entertainment resort facilities in Macau. Melco Crown Entertainment has a market cap of $13.8 billion and is part of the leisure industry. The company has a P/E ratio of 32.8, above the S&P 500 P/E ratio of 17.7. Shares are up 48.0% year to date as of the close of trading on Thursday. Currently there are 11 analysts that rate Melco Crown Entertainment a buy, no analysts rate it a sell, and 2 rate it a hold.

TheStreet Ratings rates Melco Crown Entertainment as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures and solid stock price performance. We feel these strengths outweigh the fact that the company has had sub par growth in net income.

On the positive front, Digital Domain Media Group ( DDMG), down 29.4%, Digital Domain Media Group ( DDMGQ), down 29.4%, ENGlobal Corporation ( ENG), down 17.5% and Fortune Industries ( FFI), down 15.0% , were all gainers within the services sector with TJX Companies ( TJX) being today's featured services sector leader.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the services sector could consider iShares Dow Jones US Cons Services ( IYC) while those bearish on the services sector could consider ProShares Ultra Short Consumer Sers ( SCC).

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