Las Vegas Sands Could Deliver Q4 Earnings Surprise
Fourth-quarter earnings harden is ramping upwards and Las Vegas Sands (NYSE: LVS), the largest gambling casino manipulator by market place capitalization, steps into the earnings confessional on Wednesday, Jan 25.
Some analysts trust the Venetian Macau operator could save a electropositive surprisal on its results for the October through and through December period. That’s remarkable at a clip when securities industry observers are forecasting mostly subdued fourth-quarter results from S&P 500 fellow member firms. UBS strategist Keith Parke expects 14 of 20 industries will put up year-over-year earnings declines.
However, he identified 32 stocks that could surprise on the upside when reporting results for the Dec quarter, and Sands is 1 of those names.
Just how bullish the casino operator’s fourth-quarter update will be remains to follow seen. But it’s readable Marina Bay Sands will have to hold the day inwards terms of earnings growth, because analysts widely expect all 6 Macau concessionaires to put up losses for the last tierce months of 2022. Sands China is potential sporting the largest red of the group. However, those losses testament potential follow lower than what was seen in prior quarters.
Speaking of Macau …
Macau is exchange to the Sands investiture thesis, because the accompany is the largest manipulator there, controlling cinque integrated resorts. On a per centum basis, Sands has one of the largest China-dependent revenue streams among all US-based firms, alfresco of the engineering sector.
Fortunately, overhangs such as gaming permission renewal and coronavirus traveling restrictions are easing, prompting analysts to take note. On Wednesday, UBS’ Robin Farley upgraded shares of Sands to “buy” from “neutral,” citing the remotion of license renewal risk.
We believe the young gaming law significantly lowers lay on the line for LVS: Six concessions are preserved, and the 10-year full term would pee-pee it to a lesser extent attractive for any unexampled entrants to commit inwards building a new resort,” Farley wrote inward a mention to clients. “The phasing come out of planet casinos will also cut rivalry – we idea that satellite casinos make up 'tween 15-20% of amount tables in Macau. And importantly, the law of nature tipple does not take dividend payout restrictions.”
Importantly, Macau’s porcine gaming revenue (GGR) is turned to a warm pop inwards 2023, and some analysts trust it’s potential the sestet concessionaires could post first-quarter profits.
Sands First-Quarter Outlook Matters
Las Vegas Sands was last-place year’s best-performing large-cap gaming gunstock past a astray margin, and that momentum carried into 2023, with the shares upward 13.13% twelvemonth to date. That’s to say that spell a fourth-quarter earnings surprisal would be nice, analysts and investors will live to a greater extent intently focusing on any first-quarter guidance offered by the company.
Any commentary offered upward past Sands management on next week’s earnings claim regarding Jan Macau trends and outlook for the remainder of the electric current quarter could turn out pivotal inwards terms of fanning the flames of the stock’s rally.
The companionship issuing a positive outlook for 2023 is vital, because — owing to the stock’s recent strength — some analysts aspect Sands as at present stretched on valuation, dampening near-term risk/reward prospects.
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