Q: Where else do you see value?

A: With casinos, take a look at MGM Mirage [MGM] compared to Harrah's Entertainment [HET]. Recently you could buy the debt of Harrah's, which has a better collection of assets, yielding close to 15% and trading at six or seven times cash flow. At the same time, MGM's equity was trading at about 10 times cash flow. We felt Harrah's debt was a better buy. We were short some MGM equity earlier this month, given that growth in Las Vegas is under some pressure in this economic environment, but we covered after the shares went down. MGM is a terrific company, but it turned out to be a good short for us.

its made the most money

casino

Icahn

Harrah's runs half of Las Vegas and looks to take on more and more.

"A bet on casino operator Harrah's, slated for a buyout, could bring annualized returns of 18%."

Real estate, gambling

"Other proposed deals that now look safe include Hilton Hotels (HLT), Harrah's Entertainment (HET), TXU (TXU), Alltel (AT) and Clear Channel Communications (CCU)."

buyout

From Barron's 7-30-07:

Recent Price: $83.85
Takeover Price: $90.00
Annualized Return: +20%
Est. CLosing Date: 12-31-07