Buy Ahead of Financial Results

Written by GSCR Staff   
Tuesday, 26 March 2013 10:08

With only 3 trading days left in the week and the month for that matter, and March Madness still on our brains, we thought it might be a good time to profile a gaming stock that could see some action tomorrow and in the coming weeks.

Today’s profiled stock is Asia Entertainment and Resources Ltd. (NASDAQ – AERL -$4.10), a gaming play in the People’s Republic of China.

The Company promotes three VIP gaming rooms in Macau which include a facility located in the Star World Hotel & Casino in downtown Macau, one VIP gaming room located in the Galaxy Resort Macau and one VIP gaming room located at the Sands Cotai Casino.  The move to the Sands Cotai from the Venetian Macao-Resort-Hotel in Cotai was a recent transaction which AERL Chairman Pou Lam commented, “The new VIP room should enhance our ability to better serve our existing customers, and ultimately providing our shareholders with long-term value.”

In addition to the fact that AERL will release quarterly results tomorrow which should serve as a stock direction catalyst, AERL management announced that it plans to repurchase up to 4 million shares of its common stock, which represents nearly 10% of the outstanding shares, beginning April 5, 2013.

Given recent news, trends, the buyback and solid short term technical characteristics, it appears as if the stock’s next stop could be $6.00, sometime next quarter.

Disclosure: Goldman Small Cap Research analysts are neither long nor short these shares but may elect to purchase the stock within the next 48 hours.

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