Recap of Saturday, January 26:MGM Mirage; Vivendi Universal

Our panelists give you the scoop on all the inside business information before you hear it anywhere else in The Informer segment:

David Asman, host:  Elizabeth, we all know Amazon (AMZN) made a profit.  What does it all mean?

Elizabeth MacDonald, senior editor:  Well, don't get out the party hats just yet.  Their profit only occurred because of their decent Euro currency.  If they didn't have the $16 million gain they would've been in an $11 million hole.  They're still half a billion in the red for the fiscal year 2001.  I say stay away from this stock.

Dennis Kneale, managing editor:  You have to place your bet on an internet stock and Amazon is a pretty big brand name.  I think it's going to survive.

David Asman:  Okay Dennis, what have you got for us?

Dennis Kneale:  I have Viacom (VIA).  There's a big controversy this week that CEO Sumner Redstone hates his number two guy, Mel Karmazin.  Sumner was able to buy CBS for $38 billion paying no premium on the market just by telling Mel that he could run the place for 2, 3 years.  Mel thought at some point he'd eventually take over the company but that's not the case.  I predict Mel Karmazin will leave by year-end.

Jim Clash, associate editor:  Who makes the final decision?  Is it Sumner or the board?

Dennis Kneale:  It's the board but Sumner owns 80 or 82% of the company.

David Asman:  Bruce, let's talk about video napster.

Bruce Upbin, senior editor:  In the upcoming Forbes we've got a great article on the napsterization of TV.  Remember what was going on with music downloading?  Well, the same thing will soon hit the movie industry.  People will start downloading movies.  Hollywood can sell their movies directly to consumers over fat broadband pipes.  And that's a couple billion dollar industry.

David Asman:  Let's move on to Jim Clash.  A lot of old cars on the road?

Jim Clash, associate editor:  Four out of every ten cars on the road right now are over ten years old.  I see a play right now on parts suppliers.  People will keep refurbishing their older cars till the economy gets better and they can get a new car.  Companies like Dana Corp (DCN), Delphi Automotive (DPH) and Superior Industries (SUP) will profit.  The other way these companies will profit is, when the economy does finally come back and people buy new cars, these companies supply parts to the 3 major auto suppliers.

Makers & Breakers

MGM Mirage

Mark Boyar, Boyar Asset Management: MAKER
MGM Mirage (MGG) is a casino operator.  They have seventeen hotels in three continents.  It's the Tiffany of the industry.  70% of their cash-flow comes from Las Vegas.

Bruce Upbin, senior editor: MAKER
I like this stock.  They have great properties and whether they have the Tyson/Lewis fight or not this stock is going to go up.

Matt Schifrin, senior editor: MAKER
I like this stock too.  They have great assets and there's a chance they might build a casino in China.  It's a strong buy.

David Asman:  Mark, what about the downturn in the gambling industry.  We've heard that Las Vegas has taken a hit since September 11th.   

Mark Boyer:  That is a negative.  There's certainly less people going to Las Vegas but the upside is they're cutting cost dramatically.  In five years, this company can have $5 a share in cash-flow.

Vivendi Universal

Mark Boyar, Boyar Asset Management: MAKER
Vivendi Universal (V) is an entertainment company that is re-inventing themselves.  lt owns Universal Pictures and is the largest producer of records in the world.  They have the content and now they're going to have the delivery system.  I think this company has great assets.

Matt Schifrin, senior editor: BREAKER
A lot of Hollywood companies have great assets.  Disney shareholders aren't too pleased with the performance of that stock.  I think this company will get eaten up.

Bruce Upbin, senior editor: MAKER
Barry Diller is on board now and he's a very savvy operator.  In a cyclical downturn, they have the number one share in music.  I like this stock.