The gaming industry is gearing up for the fourth-quarter earnings season, and investors are eagerly awaiting the results from key players like Las Vegas Sands, Wynn Resorts, and MGM Resorts.
Las Vegas Sands Corp. is scheduled to release its Q4 2023 results on January 24, after surpassing expectations with a 3.8% earnings surprise in the previous quarter. Revenue estimates stand at an impressive $2.9 billion, indicating a substantial 157.6% increase from the year-ago quarter. The company is expected to experience a surge in revenues, driven by increased visitation in Macao and Singapore, along with a robust influx of high-value customers and strength in gaming volumes, retail sales, and hotel occupancy. However, challenges such as an increase in gaming tax and inflationary pressures related to material and labor may impact the company’s profit margins in the upcoming quarter.
Deutsche Bank analyst Carlo Santarelli has increased Las Vegas Sands’ price share target to $66 per share, affirming a “buy” rating and expressing confidence in the company’s growth prospects in Macau and the US. However, Santarelli revised cash projections for Sands’ Macau operations in Q4 2023, citing weak market share in November, increased commissions for junket operators, and higher promotional spending.
In addition to Las Vegas Sands, Wynn Resorts and MGM Resorts are also expected to deliver strong performances. Bank of America Securities analyst Shaun Kelley projects a slight beat for MGM and a slight miss for Wynn in adjusted-earnings estimates for the fourth quarter. He remains optimistic about the industry’s performance, particularly in Las Vegas, driven by Formula 1 and baccarat. Kelley also anticipates an 11% gross-gaming-revenue upside for DraftKings in Q4, driven by the successful launch in Kentucky and increased investments behind BetMGM.
Industry analysts are closely watching the performance of these gaming industry leaders, with hopes that positive earnings reports will set a positive tone for the overall market.