Thanks hors, were you able to dump your stock this morning? Maybe you should have stayed in Celgene. It's obvious with this amazing news about the moving average and babatau's insight that this stock is a loser.
The Macau government yesterday forecast gaming revenue this year would be 20 billion Macau pataca ($2.5 billion), or a 32% decline from 2014, worse than what the Wall Street analysts have been estimating.
Chief executive Fernando Chui, re-elected last year and – just like his counterpart CY Leung of Hong Kong – also Beijing approved, followed the script well and delivered his annual policy address, during which he said Macau was now seeking a “new normal” and government regulation of the gaming sector would only increase – not decrease.
Chui noted the government will likely propose a full smoking ban in the second half this year, going into effect in 2016. Smoking is already banned on mass market floors but permitted in VIP areas. ” A full smoking ban in 2016 could weigh on VIP revenues, given the negative impact seen on mass revenues through Q4 2014 after the partial ban was implemented,” noted Wells Fargo‘s Cameron McKnight.
Meanwhile, the latest weekly gaming data from Macau remains weak. For the period between March 16 and 22, average daily table revenue was 635 million Hong Kong dollars, softer than the previous week’s HK$656 million. McKnight of Wells Fargo now sees gaming revenue in March to fall by 37-39%, a fairly standard estimate among Wall Street analysts.
Macau stocks listed in Hong Kong brushed the negative headlines away and edged slightly higher this morning. Wynn Macau (1128.HK), a unit of Wynn Resorts (WYNN), rose 1.1%. Sands China (1928.HK), a subsidiary of Las Vegas Sands (LVS) gained 1.3%, MGM China (1128.HK), a unit of MGM Resorts (MGM), rose 0.9%. Galaxy Entertainment (0027.HK) fell 0.8%. Overnight in New York, Melco Crown (MPEL) fell 1.1%.
Any dolt understands macau won't go the reit route because the companies don't even own the land. As for calling me by all those other aliases it just shows how wrong you are to the people who have actually conversed with them. We are not all in fact one in the same. The facts are the facts. This #$%$ is down 50 percent from the highs and you still think you are the bomb. If anyone is a pimply faced nerd screwing around on the message boards out of his basement its you. Daily ggr continues to go down and calling a bottom is nothing but a guess.
Bryan Maher is an analyst at Brean Capital. Brean Capital, LLC makes a market in the securities of Melco Crown Entertainment Limited (MPEL), MGM Resorts International (MGM), Wynn Resorts, Ltd (WYNN) and Las Vegas Sands (LVS).
Enjoy you dead cat bounce. Someone should tell break capital the bridge has been delayed until 2020 and vip is not coming back. Ggr is decreasing by the day. Nothing goes down in a straight line, although this practically has. See you in the teens soon. That's when I'll buy.
Sentiment: Strong Sell
CLSA released a report this week updating the outlook for the gaming industry in Macau. Despite a positive long-term outlook for Macau, analysts believe that things will get worse before they get better.
No Good News
Analysts predict that year-over-year (Y/Y) monthly gross gaming revenue (GGR) growth numbers in Macau will continue to be negative for the foreseeable future. Analysts want to see positive month-over-month (M/M) GGR numbers before they will change their bearish view on Macau.
According to the report, the anti-corruption campaign still scares many former Macau VIP gamblers, and they are unlikely to return until the heat dies down.
Related Link: The Seismic Report Pushing MGM Stock Up
Finally, analysts believe there is downside risk to the table allocation expectations for new projects Galaxy Phase II and Melco Crown Entertainment Ltd (ADR) (NASDAQ: MPEL)'s Studio City.
Analysts believe the Chinese government might not approve as many new table games for the resorts as anticipated.
Lowering GGR Growth Projections
Analysts slashed their 2015 Y/Y GGR growth estimates for the Macau market from -9.4 percent to -25.8 percent. They also cut their 2016 GGR growth projection from +26.0 percent to +10.6 percent.
Although they have a bearish near-term outlook, analysts still see value in Macau for long-term investors.
"We do not change our secular view that Macau and the oligopoly of companies that control the gaming market stand to benefit as more middle class consumers emerge from China and wish to visit the premier gaming destination in Asia," analysts explain.
Using the new "better" ggr run rate that projects to around $20 billion patacas for March 2015. $691 million * 31 days. March 2014 ggr was $35 billion patacas so we are looking at close to -40 percent. I don't think any analysts are calling for such a severe drop in ggr for March. Look out below....
Sentiment: Strong Sell
GGR improvement could cause a short-term recovery rally,” noted Nomura Securities. But the market is unimpressed, sending Macau stocks down further today. Wynn Macau (1128.HK), a unit of Wynn Resorts (WYNN), retreated 2.7%, SJM Holdings (880.HK) fell 2.3%, Sands China (1928.HK), a subsidiary of Las Vegas Sands (LVS), dropped 1.8%, MGM China (1128.HK), a unit of MGM Resorts (MGM), fell 1.1% and Galaxy Entertainment (0027.HK) was down 0.9%. Overnight, Melco Crown (MPEL) fell 1.7%.
This morning, Credit Suisse cut its Hong Kong GDP forecast, worried that tourism is no longer a growth driver. Visitors from northern China to Hong Kong often make a side trip to Macau as well. See my earlier blog “Is Hong Kong Doomed As China’s Middle Class Go Elsewhere?”
Morgan Stanley, in its report, stated that Macau GGR was very weak during the Lunar New Year period as dragged by on-going anti-corruption campaign and tighter junket liquidity which further delays GGR recovery. The research house revised FY15 GGR growth to -25% from -7% and maintained the 10% growth forecast in FY16.
WYNN MACAU (01128.HK) -0.380 (-2.202%) Short selling $57.05M; Ratio 12.777% 's rating was downgraded from Equalweight to Underweight and the target price was lowered from $20 to $16. The rating of MGM CHINA (02282.HK) -0.320 (-2.192%) Short selling $28.95M; Ratio 24.911% and MELCO CROWN was downgraded from Overweight to Equalweight, while the target price was sank from $20 to $15.
GALAXY ENT (00027.HK) -0.350 (-1.023%) Short selling $127.89M; Ratio 29.367% 's rating was maintained at Overweight, yet the target price was cut from $52 to $41. The rating of SANDS CHINA LTD (01928.HK) -0.450 (-1.438%) Short selling $168.35M; Ratio 35.538% was kept at Underweight and the target price was down from $38 to $32.
(Quote is delayed for at least 15 mins.Short Selling Data as at 2015-03-16 16:25.)