Casinos & Hotels

Las Vegas Sands Asian Revenues Plummet

Paul Ausick

Published: April 21, 2016 2:39 pm

Last Updated: January 13, 2020 10:28 am

Las Vegas Sands Corp. (NYSE: LVS) stock traded down nearly 12% at one time Thursday morning after the company reported revenues below consensus estimates and profits that were far below expectations. Revenues totaled $2.72 billion, down 10% year over year, and well below estimates of $2.88 billion. Adjusted earnings per share came in at $0.45 against estimates of $0.63 and 2015 first-quarter EPS of $0.64.

The company’s operations remained challenged by operations in Macau, where margins were expected to be better but weren’t. Las Vegas Sands did say that management is hopeful that Macau operations are stabilizing, but hope is rarely an adequate strategy.

Analysts remain unconvinced and certainly less hopeful than Sands management. J.P. Morgan cut its rating on the stock from Overweight to Neutral but raised its price target from $46 to $52. Stifel cut its price target on the stock from $58 to $56.

Macau’s casinos had been making something of a comeback in 2016 after a wretched 2015. Las Vegas Sands shares were up 19% year to date at Wednesday’s close. Wynn Resorts Ltd. (NASDAQ: WYNN), another Macau resort and casino operator, reports first-quarter results next week and is taking its lumps as well today, after posting a year-to-date gain of around 40% through last night’s close.

Las Vegas Sands also got an extremely poor showing from its Singapore resort, Marina Bay Sands, which turned in 23% less revenue than in the year-ago quarter. That was even worse than the 22.3% shortfall at the Sands Macau resort.

Shares traded down about 3.8% in the mid-afternoon Thursday at $95.69 in a 52-week range of $34.88 to $57.77. The consensus price target on the stock is $50.24, and likely does not include Thursday’s changes.