What To Expect From Las Vegas Sands In Q2

by Trefis Team
Las Vegas Sands
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Las Vegas Sands (NASDAQ: LVS) is expected to publish its Q2 2018 results on July 25. The company has reported strong revenue growth in recent years from both Macau and Singapore, driven by the recovery of the gaming industry in these regions. This trend continued in the first quarter of 2018, with net revenues growing at 17% year-on-year to $3.6 billion. Macau revenue was up 17% year-on-year to $2.16 billion, while Singapore revenue grew 26% year-on-year to $872 million. The company is likely to benefit from suite additions at the Parisian Macau, St Regis and Four Seasons properties, the renovation of VIP gaming areas at the Venetian and Plaza Macau, and full scale development of two luxury hotel towers in the Vegas area. This should help improve gaming and non-gaming services in the domestic and Macau markets. We expect this to continue through the end of the fiscal year, with net revenues forecast to increase at similar rates. Below, we take a look at what to expect when the company reports earnings.

We have a $79 price estimate for Las Vegas Sands, which is higher than the current market price. The charts have been made using our new, interactive platform. You can click here to modify the different driver assumptions, and gauge their impact on the earnings and price per share metrics.

Factors That May Impact Future Performance

Macau enjoyed a strong Q1, as margins improved as a result of robust revenue growth due to the casino industry rebound in the region. The gross gaming revenues (GGR) in Macau grew by nearly 21% y-o-y this quarter, indicating a strong start to the year. The Cotai strip has been witnessing strong traffic and higher occupancy rates, driven by the most recent addition of The Parisian Macau. LVS expects further improvement in Macau, as a result of strong traffic and higher occupancy rates. In addition, the company expects its diversified offerings in the Cotai strip and various new infrastructure developments in Macau to continue to provide solid growth. We expect Macau to be the driving force for LVS in 2018, since the gross gaming revenues (GGR) in the region grew consistently for the 23rd straight month in June 2018. In addition, the various new infrastructure developments in Macau should boost the mass market business for the company.  Further, the company expects its diversified offerings in the Cotai strip to continue to provide solid growth. Given the improved outlook of the casino market in Macau, we expect another strong year for LVS in Macau driven by rising outbound travel, strong spending growth, and its strong presence in the region.

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