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Macquarie Comments on U.S. Gaming Operators

Eric Niederer

In a note released Tuesday, the analysts at Macquarie Research provided insight into how to play the U.S. Gaming Operators amid flat year-over-year gross gaming revenue (GGR) through the June 15 and the transition from low-margin VIP to higher margin mass market.

In the near-term, the team is expecting a two percent decline in GGR for June, a seven percent increase in the second quarter, and a 12 percent increase for the full year in 2014, which is towards the low end of consensus estimates.

Based on the sentiment that overall Macau is weakening, the analysts at Macquarie have reduced their price target for Las Vegas Sands (NYSE: LVS) and Wynn Resorts (NASDAQ: WYNN) from $90 and $225 to $85 and $215, respectively.

Looking to the second quarter, the team believes Las Vegas Sands and MGM Resorts (NYSE: MGM) are best set up for an earnings surprise, and put an extra emphasis on Las Vegas Sands.

Following the release of the note, shares of Las Vegas Sands are up less than one percent and shares of Wynnn Resorts are down less than one percent.

For a more detailed look into how the U.S. gaming stocks have performed so far this year, click here.

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