Dire Financial Situation Forces Japan to Reconsider Casinos

Amid economic distress and the wreckage of the major March earthquake, Japan (NYSE:EWJ) is revisiting its stance on casinos. The country has historically banned casinos, fearing that gambling would breed crime, but a dire financial situation is forcing the government to reconsider. Legislators plan to introduce a bill that will allow casinos in the government session that will begin next month.

Bloomberg quoted politician Takeshi Iwaya who said, “It would be an engine for fiscal revival and job creation that wouldn’t require raising taxes.”  The bill has support from both the ruling Democratic party and the chief opposition, the Liberal Democratic party.

A study in 2009 by Ryosaku Sawa, an economics professor at Osaka University of Commerce, estimated that casinos could debut  as a 3.4 trillion yen ($44 billion) industry should it be legalized. The source of revenue is a major selling point to the Japanese government, who is currently the owner of the world’s largest public debt and faces 19 trillion yen in damage resulting from an earthquake that struck in March. Sheldon Adelson, CEO of Las Vegas Sands Corp (NYSE:LVS), says he has been lobbying for casinos in Japan for the last five years and hopes his efforts will allow his company to be a front runner should the bill pass.

Here’s how top casino stocks are trading on the news:

Las Vegas Sands Corp. (NYSE:LVS): LVS shares recently traded at $43.23,. They have traded in a 52-week range of $36.05 to $51.05. Volume today was 57,464 shares versus a 3-month average volume of 16,526,400 shares. The company’s trailing P/E is 28.82, while trailing earnings are $1.50 per share.

MGM Resorts International (NYSE:MGM): MGM shares recently traded at $9.87,. They have traded in a 52-week range of $7.40 to $16.94. Volume today was 79,060 shares versus a 3-month average volume of 21,305,200 shares. The company’s trailing P/E is 1.70, while trailing earnings are $5.79 per share.

Wynn Resorts Ltd. (NASDAQ:WYNN): WYNN shares recently traded at $110.18,. They have traded in a 52-week range of $99.21 to $172.58. Volume today was 3,300 shares versus a 3-month average volume of 3,807,450 shares. The company’s trailing P/E is 25.72, while trailing earnings are $4.28 per share.

Boyd Gaming Corp. (NYSE:BYD): BYD shares recently traded at $6.17,. They have traded in a 52-week range of $4.12 to $12.78. Volume today was 4,800 shares versus a 3-month average volume of 1,587,460 shares. The company’s trailing earnings are $-0.12 per share.

Melco Crown Entertainment Ltd. (NASDAQ:MPEL): MPEL shares recently traded at $9.05,. They have traded in a 52-week range of $5.55 to $16.15. Volume today was 28,430 shares versus a 3-month average volume of 9,013,260 shares. The company’s trailing P/E is 23.94, while trailing earnings are $0.38 per share.