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<Research>UBS Expects MO Casinos' 1Q25 Luck-Adj. EBITDA to Dip 4% QoQ
Recommend 23 Positive 47 Negative 28 |
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UBS stated that SANDS CHINA LTD (01928.HK) will kick off the 1Q25 earnings season for Macau gaming stocks. According to the Macau Gaming Inspection and Coordination Bureau (DICJ), the 1Q25 GGR reached MOP57.7 billion, up 1% YoY and flat QoQ. UBS expected mass GGR to fade 2% QoQ, offset by a 14% QoQ rise in VIP GGR, leading to a 4% QoQ drop in sector luck-adjusted EBITDA, given a higher VIP share and reduced non-gaming revenue impacting margins. Operating expenses are projected to remain stable, with fewer non-gaming activities in the quarter. Overall market share may be driven by VIP, with SJM HOLDINGS (00880.HK) and MGM CHINA (02282.HK) potentially gaining mass share from SANDS CHINA LTD, GALAXY ENT (00027.HK) and WYNN MACAU (01128.HK). UBS anticipated SANDS CHINA LTD and SJM HOLDINGS’ quarterly results may miss expectations. Investors are likely to focus on management’s comments regarding demand amid weak macro sentiment and the ongoing crackdown on illegal currency exchange shops. Intensifying market competition will remain a key concern, shaping profitability outlooks. Based on better market share trends and relative valuations, UBS preferred MGM CHINA and Melco Resorts (MLCO.US) ahead of the earnings season. AAStocks Financial News |
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