Las Vegas Sands – $LVS Stock Overview And Forecasted Price | Biggest Casino Company Worldwide



Disclaimer: I am not a financial advisor and this is not financial advice.

Today we’re looking at a stock that has plummeted over the last 5 months and whose price action closely correlates to the pandemic restrictions. Las Vegas Sands is the global leader in convention-based integrated resort development and operation. They are an American casino and resort company based in Paradise, Nevada. Its resorts feature accommodations, gambling, entertainment, convention and exhibition facilities, restaurants and clubs, as well as an art and science museum in Singapore. Las Vegas Sands owns and operates several resorts in the US and Asia. Earlier this month, Las Vegas Sands announced that it was putting together a digital gaming investment team since digital gaming and online sports betting have been all the rage among casino companies lately. It is the largest casino company worldwide with a market cap of $36.07 billion.

In early March, Las Vegas Sands announced that it was selling its Las Vegas real estate and operations for $6.25 billion. That transaction, which is expected to close in the fourth quarter, was a major shift for the company. Among the resorts sold are also The Venetian and The Palazzo on the Las Vegas Strip. This makes it clear as day that the company is shifting its focus to Asia. They have made Macau in China a priority. In 2019 before the pandemic struck, Macau accounted for more than half of all company’s sales. Potential investors should note that Las Vegas Sands’ operations in Asia still face pandemic-related travel restrictions as the cases increase again, which may impact future earnings reports.

This stock belongs to the travel and entertainment sector which suffered the most during the pandemic. That’s why they have had negative earnings reports for a while now. In Q2 2021, they reported earnings per share of -$0.26 versus the consensus estimate of -$0.17. They also reported revenue of $1.17 billion, which falls below the estimates of $1.39 billion as pandemic restrictions in key regions continue to impact traffic. Second-quarter net revenues improved greatly compared to the $62 million a year ago during the peak of lockdowns. The casino company continues to show sequential progress and better earnings reports with this quarter having positive EBITDA in Macau and Singapore. Las Vegas Sands’ P/E ratio is 105 at the moment. This ratio has increased significantly not because of a stock price increase or overvaluation, but rather because of their poor earnings during the last year and a half. Their next earnings report is scheduled for Oct 27, 2021.

Analysts at J.P. Morgan expect this stock to reach $59 in the next 12 months. Moreover, analysts at Deutsche Bank have a price target of $73 per share for Las Vegas Sands. The consensus estimate is that the share should recover to the pre-pandemic valuation in the next 12 months. Out of 15 analysts, 10 have given the stock a BUY rating and 5 a HOLD rating. Las Vegas Sands’ stock is trading for $45.77 right now. The consensus estimated average stock price in the next 12 months is $62.73 which is an increase of more than 35%. The lowest estimate is $50, while the more bullish stock market analysts expect it to reach $83.50. The current stock price might be a good entry point for potential investors since the analysts believe it is undervalued at the moment.

Remember this is not investment advice, you should always perform your own due diligence before making any investment decisions.

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