BUSINESSWEEK ONLINE : DECEMBER 11, 2000 ISSUE
BUSINESSWEEK INVESTOR -- INSIDE WALL STREET Is Park Place Set to Cash In? Gambling companies don't usually show up on the radar screen of Bob Olstein, president of Olstein Financial Alert Fund, who is a fanatic about cash flow and financial strength. Yet Park Place Entertainment (PPE), the world's largest casino company, has caught Olstein's eye. The reason: Park Place is on a solid financial footing, generating excess cash flow of about $500 million through the third quarter--and it is expected to hit $700 million in 2001. On top of all that, Park Place is takeover bait, says Olstein. Since the death in mid-October of CEO Arthur Goldberg, speculation has grown that a foreign operator might make a move on the company, which owns 28 properties with 2 million sq. ft. of gaming space and 28,000 hotel rooms. In the U.S. it operates in Nevada, New Jersey, and Mississippi. Its casinos include Caesars Palace, Bally's, and Hilton. ''These geographically diversified properties are almost impossible to duplicate,'' says Olstein. He figures the company expects to earn 85 cents a share in 2001. But that figure is understated, he says, because the $500 million that the company allows for depreciation is twice the $250 million set aside for maintenance capital expenditures. ''The real net earnings is more like $1.30 a share,'' Olstein figures. So he thinks the stock, now at 13 5/8, is worth more than 20. BY GENE G. MARCIAL _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ BACK TO TOP					RELATED ITEMS Is Park Place Set to Cash In? CHART: A Dry Runup INTERACT E-Mail to Business Week Online

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