NEW YORK (TheStreet) -- Shares of Melco Crown Entertainment Ltd. (MPEL) are down by 3.03% to $21.54 in late morning trading on Wednesday, as Macau casino stocks react negatively to the latest government crackdown on illegal activity coming out of the Chinese gambling hub.
The government is now going after illicit money channeled through the city's casinos, according to an article in the South China Morning Post, Bloomberg reports.
China has been cracking down hard on illegal activities coming out of the country's gambling region. In March, Reuters ran a special report showing how a growing number of people were using UnionPay cards to illegally send billions of dollars overseas through the casinos.
The government's investigations into Macau have been hurting its revenue as high stakes players have started to avoid the tables.
Revenue in Macau has fallen every month since June, and in October revenue retreated 23%, which is the biggest decline on record, NPR reported.
Separately, TheStreet Ratings team rates MELCO CROWN ENTMT LTD as a Buy with a ratings score of B-. TheStreet Ratings Team has this to say about their recommendation:
"We rate MELCO CROWN ENTMT LTD (MPEL) a BUY. This is driven by several positive factors, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, reasonable valuation levels and notable return on equity. We feel these strengths outweigh the fact that the company has had sub par growth in net income."