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$0.41 -0.04 (-8.89%)
7/3/2008 1:00 PM

Magna Entertainment Corp.(USA) (MECA)

CAPS Rating:
*

Owns and operates horse racetracks in California, Florida, Maryland, Texas, Oklahoma, Ohio, Michigan, Oregon and Ebreichsdorf, Austria and supplies, via simulcasting, live racing content to the growing inter-track, off-track and account wagering markets.

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Avatar HFInvestor (< 20) Submitted: 5/26/07 10:05 PM : Outperform Start Price: $3.53 MECA Score: -71.52

Underlying real estate is worth $6+ per share which will serve as a cushion to the stock price. Sale of up to $400 mln of non-core assets in the next couple of years is a potential catalyst. MI Developments owns 59% and will not let MECA go bankrupt (it will provide financing if needed, regardless of what Greenlight tries to argue). Potential for improving revenues by changing pricing model with resellers and room for substantial cost reductions by consolidating functions.
Risks: Asset sales don't materialize. Mgmt team has yet to prove they can execute the strategies they have laid out.

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Avatar HFInvestor (< 20) Submitted: 7/13/07 10:39 AM

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I should have put this comment out at the end of June but got sidetracked. I think that the CEO Michael Neuman leaving was a huge negative since he was one of the (few) near term catalyst I saw for the underlying real estate value to get unlocked. Now that he is out, I don't see any near term catalyst. The fact that he most likely left because Stronach would not let him do what he thought needed to be done makes it even worse. However, given how far the stock has fallen since he left, the theoretical upside is greater but I am afraid we might have to wait a lot longer now before that gets reflected in the stock price.

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Avatar microslave (< 20) Submitted: 4/19/08 3:38 PM

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This stock can't get much lower. Santa Anita is a world class race track along with Gulf Stream. What does Churchhill do thats better? Their stock is a hundred times this one. Something needs to change somewhere because big money is flowing at these tracks. The world of Gambling is changing dramatically with the slots and a percentage of the profit going for race purses. Purses determine the Level of competition. Look at the oil companies profits. They go off pecentages. 10% of $2.50 or 10% of $4.50. Big Money. A percentage of slots profits should help this stock some.

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