Although the name Las Vegas Sands (LVS) sounds like a play on Nevada gaming, this hotel-and-casino company is currently generating the bulk of its earnings growth in the Far East. Hotel-and-casino operations in Macao (China) and Singapore are allowing the casino operator to post significant rates of revenue and bottom-line growth.
Current properties of Las Vegas Sands are The Venetian and The Palazzo in Las Vegas. In Macao, the company owns the Venetian Macao, the Sands Macao and the Four Seasons Macao. Development continues on company-owned property in the Chinese special administrative region. The newest LVS property is the Marina Bay Sands in Singapore.
The Macao and Singapore operations generated almost 90 percent of the $745.7 million EBITDA reported for the first quarter on revenues of $2.11 billion. For the quarter, the Macao properties posted a 46 percent year-over-year increase in EBITDA. Another $284.5 million of EBITDA from Singapore came from a property not open one year earlier.
LVS Chairman Sheldon Adelson noted in the earnings conference call remarks that the company EBITDA had increased for the seventh consecutive quarter and had tripled since the second quarter of 2009.
The share price of LVS has been in a downward trend since peaking near $53 per share in early November 2011. This may be due to the failure of the net earnings per share to keep up with analyst expectations.
The first quarter net of 37 cents per share, up from 7 cents a year earlier, significantly missed the consensus estimate of 43 cents per share. Full year earnings are forecast at $1.70 per share.
Analyst Mark Strawn of Morgan Stanley anticipates slowing revenue growth in Macao but predicts strong 2011 second half growth in the Las Vegas market. He favors Las Vegas Sands over rival Wynn Resorts (WYNN) due to the strong Vegas presence of LVS.
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