International casino resort operator Las Vegas Sands Co. (NYSE: LVS) name may be slightly misleading now since they no longer own or operate any casinos in Las Vegas or the U.S. The company operates integrated casino resorts in Macao and Singapore. It had sold off its remaining Las Vegas properties Venetian and Palazzo reports to Apollo Global Management Inc. (NYSE: APO) and Vici Properties in 2022 for $6.25 billion. By 2021, its Asian operations nearly doubled its U.S. operations.
Amidst growing competition from rivals like Wynn Resorts Limited (NASDAQ: WYNN), MGM Resorts International (NYSE: MGM), online casinos and sports betting, Las Vegas Sands decided to change direction. The company pivoted to go all in on its Asian properties, selling off its U.S. properties to reduce debt and pursue greater opportunities overseas. The company is eyeing the possibility of opening a location in Thailand if it gets legalized there. Las Vegas Sands is bidding for a gaming license in New York and has secured the Nassau Coliseum. It plans to spend over $5 billion to develop a five-star resort.
Singapore Growth
Marina Bay Sands is the iconic landmark resort in Singapore owned and operated by Las Vegas Sands. The property has three 55-story towers, which are connected by the one-hectare SkyPark Infinity Pool, the largest infinity pool in the world. The property has 3,561 rooms and suites, with 1.4 million sq. ft of gaming and retail space. The location generated the most revenues of all its properties at $1.37 billion in revenues in Q3 2023, up 34.3% YoY and adjusted property EBITDA of $491 million. The company expects the property to generate over $2 billion in annualized EBITDA in the future.
Astounding Recovery in Macao
The lifting of the zero-COVID restrictions in China, combined with the travel and tourism boom, has seen a seismic recovery in Macao. The first week of October is the national Golden Week holiday. Macao saw over 932,000 visitors during this year's Golden Week holiday, averaging 116,000 visitors daily, up over 370% YoY. The average hotel occupancy was 87.9%. The single-day record of visitors peaked at 158,776 on Sept. 30, 2023.
Macao Recovery Expected to Accelerate
Las Vegas Sands has stated that Macao is the most important land-based market in the world. The company has invested $15 billion in Macao and owns five properties. Its Q3 2023 EBITDA illustrates robust growth. Its retail Macao business has "far exceeded" pre-COVID numbers. Its top revenue-earning property was The Venetian Macao, generating $723 million, up from $104 million in the year-ago period. Macao's adjusted property EBITDA was $631 million.
During the conference call, Las Vegas Sands CEO Robert Goldstein commented, "We've gone from a dead stop in January back to the very difficult times of no one coming to mere nine months later about 80% of Q3 '19. But how much are they going to go? I think a lot more. If you look at Singapore, this trajectory, I think it's very telling what's going to happen in Macao."
Impressive Earnings
On Oct. 18, 2023, Las Vegas Sands reported its fiscal Q3 2023 earnings for the quarter ended in September 2023. The Company reported an earnings-per-share (EPS) profit of 55 cents, in line with consensus analyst estimates of 55 cents. Revenues surged 178% YoY to $2.8 billion, beating $2.1 billion analyst estimates, up from $1 billion in the year-ago period. Consolidated property EBITDA was $1.12 billion, up from $191 million in the year-ago period. Sands China Ltd. generates $1.78 billion in GAAP net revenues, up from $251 million in Q3 2022. Net income was $231 million compared to a loss of $472 million in the year-ago period. The company authorized a $2 billion stock buyback program through November 2025.
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Daily Descending Triangle Pattern
The daily candlestick chart on LVS illustrates the descending triangle pattern. The solid Q3 2023 earnings report caused a price gap that attempted to break out of the pattern, but shares fell back under the daily market structure low (MSL) buy trigger at $46.00 and under the descending trendline. The daily relative strength index (RSI) oscillator is stalled under the 45-band.
LVS is still struggling to break the descending triangle pattern which it can only do if it can rise through the MSL trigger above $46.00. Pullback support levels are at $44.38, $43.77, $42.50 and $41.25.
