I used to call Las Vegas home, and even worked for a stint in the Gaming Industry, and it was well known that lower gas prices contributed to more road driving Californians and Arizonans visiting Sin City. Not only are drivers more willing to make the trip with lower gas prices, but they also bring more disposable income for higher room rates, more fine dining, shopping sprees and of course plenty of table and slot machine plays. MGM Mirage (MGM) is well positioned to take advantage of the lower gas price trend. Not only is the company a dominant player on the Las Vegas Strip, and in other "commuter" Gaming markets, it also owns the resorts on the California/Nevada border at Primm, Nev. and Jean, Nev. which are favorite first stops for commuting drivers. MGM Mirage trades at $38.97, with a little higher than comfortable PE of 23. The stock is towards the low end of its $34.20 - $46.15 52-week price range and could be purchased optimally around $38.50, but could be a nice run at its current price point. Goleta Capital goletacapital.blogspot.com

Advanced Environmental Recycling Technologies (AERT) stunned the street last week disclosing that some defective equipment caused the delayed opening of its Springdale (Ark.) South manufacturing plant which will result in softer sales for the third quarter ending September 30. The stock has declined from a price of $3.10 on August 15 to a close yesterday at $2.25. We think the stock is nearing an oversold condition and speculative investors should start looking at the shares. The company, which makes composite decking which is sold in major home-improvement retailers, is entering the softest part of the year with Winter right around the corner. The company has disclosed that it believes it has enough inventory to get it through the slow fourth quarter, and then has new products planned for 2007. While the delayed opening of the new plant may cause a minor hiccup in earnings, we feel this could create a buy opportunity for a high-flying stock. Speculative investors should keep an eye out around the $2.00 - $2.15 level if the stock were to get that low. Goleta Capital goletacapital.blogspot.com

Pacific Capital Bancorp (PCBC) – Takeover Bait For whom the bell tolls…the bell tolls for thee. With today’s announcement of the retirement of Pacific Capital Bancorp’s (NASDAQ: PCBC) Chief Executive Officer, William Thomas, and no clear path of succession, it appears that the run at the company could be over and it could soon surface as takeover bait in an improving economic climate. First, the next officers in line – Vice Chairman Clayton Larson (59) and Chief Administration Officer Frederick Clough (62) – are years away from retirement themselves which leaves the company without clear succession plans at the top. Second, the company is only trading at a price-to-book ratio of 2.06, well below valuation levels for recent takeovers, after reaching a fresh 52-week low of $26.15 on October 3. We think the company can fetch at least 2.5 – 3.0 times book in a take over, a price of over $30 per share. Third, the company only trades at 11.26 times forward earnings and has a price-to-sales ratio of 2.65, near the lower end of its historical average. With 48 offices in the “heartland” of California, we think Pacific Capital Bancorp could attract a larger regional player. The company would have to attract a fairly large suitor due to its size and geographic reach, but would be a perfect fit for banks seeking to secure significant market share in some higher income areas of California. While we don’t recommend buying stock for takeover plays, we think value investors may want to seriously consider completing some due diligence of their own on Pacific Capital Bancorp. Disclosure: Goleta Capital principals own stock in Pacific Capital Bancorp.

I just got back from Cancun and traveled through a ASR airport and was very impressed with the operations at the airport. Traffic is again picking up in Cancun after Hurricane Wilma destroyed the city, and ASR is poised to gain from the strong traffic and tourist counts. Also the fact that the company promotes its stock throughout the airport leaves plenty of investors interested in the stock. I would buy ASR down around the 40 level, after a pull back due to the departure (no pun intended) of its CEO. goletacapital.blogspot.com