Trump up on possible buyout news
Shares of Trump Entertainment Resorts, Inc. (Nasdaq: TRMP) are up on news reports that Dune Capital Management, LP is a possible bidder for the company’s Atlantic City, N.J. casinos.
In afternoon trading shares of the New York icon’s company gained $1.00, or 7.17% to $15.39. The stock has been trading in a range of $12.98 to $23.80 over the past 52 weeks.
Dune Capital Management, which is run by former Goldman Sachs & Co. executives, is reported to be one of many parties to possibly bid for Trump Entertainment. Today’s development comes on the heels of Wednesday’s news that former Trump executive and regulator Dennis Gomes entered into a confidentiality agreement with Trump Entertainment Resorts, indicating he is making a bid for the company's Atlantic City casinos, people familiar with the matter told Dow Jones Newswires.
On Tuesday, Bear Stearns analyst Carlo Santarelli downgraded Trump Entertainment to “underperform” from “peer perform.” Santarelli wrote in a research note on Tuesday that shares of Trump are trading significantly ahead of fundamentals. He cut his second quarter 2007 earnings per share target to a loss of $0.44 per share, from a loss of $0.11 per share. He also lowered his fiscal year 2007 earnings per share outlook to a loss of $1.10 from a loss of $0.22.
According to Forbes.com, Santarelli does not expect a buyout of Trump Entertainment will be consummated because of competition from states bordering New Jersey and large influxes of cash needed to make the venture profitable.
