Macau Casino Stocks Show Valuation Opportunities After Declines

Macau Casino Stocks Show Valuation Opportunities After Declines

Last updated on September 24th, 2023 at 12:24 am

Due to fears about China’s slumping economy, Macau casino stocks continued to slide since August. However, one analyst believes that the industry will rebound soon.

Stifel analyst Wieczynski found investors can benefit from China’s macro uncertainty. The two U.S.-based Macau concessionaires, Wynn Resorts and Las Vegas Sands have seen their stock prices fall significantly over the past month. According to bookie PPH reports shares of Sands are down more than 15% over the past month, while shares of the parent company, Wynn Macau, are down 4.70%.

Although Wieczynski lowered his price expectations for Sands and Wynn, they still imply substantial growth for both companies. Today, Wynn ended trading at $91.56, while Sands finished at $45.79.

Macau Casino Stocks to Rebound Soon

This year, Macau’s GGR is expected to approach its levels before the coronavirus outbreak. According to betting software reviews and news sites, this is good news for both businesses. Standard & Poor’s recently predicted that GGR will reach 85% to 90% of pre-coronavirus levels this year, an increase from their previous prediction of 75% to 85%. Rebounding fully by 2024, according to S&P. This is especially significant for Sands, along with Galaxy Entertainment, which dominates Macau’s mass and premium-mass betting markets.

Despite typhoon closures in September, next Golden Week is a chance to disprove China’s weakening economy.

Although Wieczynski is optimistic about Las Vegas Sands, the parent company of Sands China, he prefers Wynn due to its exposure to premium mass clientele.

According to sportsbook pay per head experts, Sands and Wynn sell at significant discounts to their historical norms. Thus, investors may try these stocks without fully committing to their high multiples.

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