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StockBeat: Las Vegas Sands Climbs on Deutsche Bank Upgrade

Published 09/09/2019, 18:09
Updated 09/09/2019, 18:54
© Reuters.

© Reuters.

Investing.com – Las Vegas Sands climbed on Monday after Deutsche Bank (DE:DBKGn) upgraded its outlook on the casino operator, citing an "attractive" long-term entry point.

The current odds are not in favor of gaming stocks, which have seen activity stutter in the key gambling region Macau, pressured by the Hong Kong protests and ongoing U.S.-China trade. But for Deutsche Bank (DE:DBKGn), the weakness in the region creates an "attractive" long-term entry, with the bank upgrading Las Vegas Sands to buy from hold, sending Las Vegas Sands (NYSE:LVS) more than 2% higher.

A little over a week ago, data showed gross gaming revenues in Macau fell in August for the second straight month. Gaming revenues from Macau, the world’s largest gambling hub, declined 8.6% in August year-on-year.

As well as the ongoing U.S.-China trade war and protests in Hong Kong, competition from Asian casino operators in Macau has also kept a lid on growth for U.S. gambling companies.

Against the backdrop of headwinds in Macau, U.S. gaming companies have found a semblance of support in the expansion of U.S. sports betting following the repeal – in May last year – of the Professional and Amateur Sports Provision Act of 1992, which paved the way for individual states to introduce legislation permitting sports betting.

With gains of 11% so far this year, shares of Las Vegas Sands have lagged the broader market, up more than 18%, and rivals Wynn Resorts (NASDAQ:WYNN) and MGM Resorts International (NYSE:MGM), up 16% and 18% respectively.

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