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Private equity buy-out speculation for gaming companies creating uncertainty for investors

    CIBC World Markets' new valuation model helps investors identify where to
    place their bets

    NEW YORK, July 2 /CNW/ - CIBC (CM: TSX; NYSE) - Hovering private equity
speculation in recent months is making it difficult to peg the value of gaming
stocks in the near term and leading to tough calls and significant risks for
investors, according to a top U.S. gaming and lodging analyst.
    A new valuation model created by CIBC World Markets' Gaming and Lodging
Analyst David Katz is helping investors make sense of the market and make more
confident decisions about where they should place their bets in response to
this uncertainty in the marketplace.
    "Determining how much speculation over a private equity buyout is adding
to stock prices and how likely it is the buyout will take place is a
challenging but critical issue for investors to address," says Mr. Katz. "The
fact is private equity speculation has driven all prices higher these days.
Whether they will stay high, grow higher or fall as a result of a potential
transaction is the gamble for investors. We're trying to make the investor a
smarter player."
    Traditionally, fundamental analysis has been the strongest indicator as
to whether or not a particular stock was viewed as a buy or sell for
investors. But the game has changed recently, notes Mr. Katz. In a recent
research report he states that recent private equity transactions in the
casino space in the past 18 months are driving stock prices to a greater
degree than operating results and other fundamental analyses.
    "Although our fundamental analysis matters, it remains only a part of the
story in this environment. The other part involves the likelihood that the
company could or would entertain a private market take-out offer," adds Mr.
Katz. As a result, CIBC World Markets has taken a new approach to valuing
gaming stocks, which results in new probability weighted price targets, based
partly on fundamentals and partly on the likelihood of a take-out.
    "Calculating a take-out valuation and take-out probability for each
stock, in our view, results in a more reasonable and realistic approach to how
the market is pricing in the likelihood of a take-out," says Mr. Katz. "In
most cases, the premium of our take-out valuation to our fundamental target is
in the 25%-35% range. That range enables investors to make informed decisions
about where there is hidden value and where there isn't, which ultimately
leads to better and more confident investment decisions," says Mr. Katz.
    M&A activity and private equity premiums are topics that should be top of
mind among investors at the CIBC World Markets Gaming and Lodging Conference
in Boston July 12. The event, featuring over 20 leading companies in the
gaming and lodging space, provides a valuable mid-year opportunity for
investors to assess these sectors and key investment issues.
    More information including a conference agenda can be found at:
http://conferences.cibcwm.com/consumer07/ . An audio web cast of conference
will be available: (http://conferences.cibcwm.com/consumer07/) (enter code:
boston2007).

    CIBC World Markets is the wholesale and corporate banking arm of CIBC,
providing a range of integrated credit and capital markets products,
investment banking, and merchant banking to clients in key financial markets
in North America and around the world. We provide innovative capital solutions
and advisory expertise across a wide range of industries as well as top-ranked
research for our corporate, government and institutional clients.
    The Consumer Growth Conference is organized by CIBC World Markets
Institutional Equities.




For further information:
For further information: Media contact: David Katz, Executive Director,
Gaming & Lodging Equity Research, CIBC World Markets Corp., at (212) 667-8161;
or Tom Wallis, Communications & Public Affairs, CIBC, (416) 980-4048

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