Thursday, October 4, 2012

Casino Stocks Slid After Macau’s Revenue Data – LVS, MPEL, MGM, WYNN

This morning, data showed that the Gambling revenue in Macau surged 12.3% in the latest month, which came in below expectations, signaling China's slowing economy is affecting the country’s wealthy mainland gamblers to gamble.

With the second weakest revenue this year, the Macau government on Thursday announced September revenues at 23.87 billion patacas or $2.99 billion.

With the national holiday week, starting on October 1, knocking on the doors, the forecasted growth was an up by 15-17 percent in the tiny enclave on China's southern coast.

The due change in political leadership and slow economy of China serves to be the main reasons for the downfall of revenue generation for Macau's gambling, over the past five months.

The only legal place of gambling for the Chinese in the country is the former Portuguese colony, which is reachable from Hong Kong by ferry in an hour.

Contributing around 40 percent of the casino-crammed hub's GDP is the Macau economy relying heavily on the gambling market.

August registered 0.6 lower visitors, year on year. This clearly indicated a downtrend of visitors.
Of the six competitors operating in Macau, are Las Vegas stalwarts Steve Wynn, through his Wynn Macau unit, and MGM China.

Expanding casino skyline a new hotel and casino was opened in Macau by owner of Sands China, a casino magnate and high-profile Republican donor Sheldon Adelson.

On Thursday, shares of Macau gambling companies fell 3-4 percent in Hong Kong.

While there was a gain of 0.1 percent for the shares of Macau gambling companies on the Hong Kong index.
Victor Yip, analyst at brokerage UOB Kay Hian in Hong Kong quoted "There could be some profit-taking in the short term unless there is anything positive happening on the policy side.”

Las Vegas Sands Corp.(NYSE:LVS) shares slid 2.15%, Wynn Resorts, Limited(NASDAQ:WYNN) slid 0.50%, Melco Crown Entertainment Ltd (ADR)(NASDAQ:MPEL) lost 4% and MGM Resorts International(NYSE:MGM) declined 1%.

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