08/04/2002 11:00PM

Magna stock down again

Email

Shares of Magna Entertainment plummeted for the third day in a row on Monday, dropping 56 cents, or 13.8 percent, to $3.45, a new 52-week low.

Since July 31, the day Magna released second-quarter earnings that disappointed analysts, Magna's stock has slid 37 percent, or $2.05 (Magna stock was $5.50 at close on July 31). Magna's stock traded at $10.25 in early February.

Magna, the largest racetrack operator in the United States, owns 10 tracks and has deals to buy into four others. It has spent more than $350 million over the past four years to make the acquisitions, and has $220 million tied up in the other four deals.

With the three-day slide, Magna's market capitalization has dropped to $362.8 million, or slightly more than the company has spent already to acquire its assets. Magna said last week that the company has $135 million in cash and $35 million in real estate the company plans to sell.

Magna's chief executive, Jim McAlpine, blamed the poor second-quarter performance on increased insurance and utility costs and "under-performing" tracks.

Since the earnings announcement, analysts at Bear Stearns and CIBC World Markets have downgraded Magna's stock. Bear Stearns underwrote an April stock offering by Magna.