While a rumor floating recently that Penn National Gaming (PENN: 25.62 +2.85%) would purchase the Mirage Casino and Resort from MGM Mirage proved to be unfounded, the very possibility of such a sale is informative.

Penn National is one of the few casino operators in the US to have a strong financial situation at the current time. An executive with Seminole Gaming, the operators of the Native American casinos in Florida and owners of the Hard Rock brand, said, “There are only two gambling operators around with the cash to acquire new projects, and that’s us and Penn National.”

Having the credit available to buy a major casino puts Penn into a limited group. The second important piece of information is that Penn may be ready to step up to the adults’ table. A casino on the Las Vegas Strip would be as important for Penn in reagrds to prestige as much as revenue.

The gaming company mostly runs smaller, local-based casinos, and acquiring a Strip foothold would put Penn on a par with Harrah’s Entertainment and MGM Mirage.


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