Las Vegas Sands Still the Best in Gaming

By Travis Hoium | More Articles
October 28, 2011 | Comments (2)

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The best bet in gaming, Las Vegas Sands (NYSE: LVS ) , showed yesterday exactly why it has the deck stacked in its favor. The company has the best properties, in the best locations, and is the best operator to boot.

During the third quarter, that advantage helped send revenue 26.2% higher to $2.41 billion and adjusted property EBITDA to $924.1 million. Marina Bay Sands, one of just two casinos in Singapore, led the way with revenue climbing 63.1% to $792.4 million and property EBITDA exploding 71.3% higher to $413.9 million. That's an incredible 52.2% EBITDA margin.

These incredible results are in contrast to an earnings report from Wynn Resorts (Nasdaq: WYNN ) that had investors wishing for more. In Macau, results for Las Vegas Sands weren't very different from Wynn, with EBITDA down slightly from the second quarter at the Venetian Macau. Sands Macau, which is located on the Macau Peninsula with Wynn, took a bigger hit, so we're likely seeing some move of gaming dollars to Cotai, where Las Vegas Sands and Melco Crown (Nasdaq: MPEL ) dominate the action. But that's something we've seen coming from a mile away.

Wynn's and Las Vegas Sands' results should give us a good peek into what Melco Crown and MGM Resorts (NYSE: MGM ) will report for the third quarter. Even though Macau's gaming revenues grew tremendously during the quarter, with Galaxy opening a casino on Cotai the wealth was spread around, and growth will likely be flat or negative quarter over quarter.

Foolish bottom line
Las Vegas Sands has been my top pick in gaming for quite some time, and a quarter like this proves why. Despite slightly lower performance, the company's Macau casinos are still performing well -- and with Sands Cotai Central on the way next year, the Cotai Strip should continue to pay dividends. And none of the other U.S.-traded gaming operators can give you exposure to Singapore and its tremendously profitable casinos like Las Vegas Sands can.

Interested in reading more about Las Vegas Sands? Click here to add it to My Watchlist, which will find all of our Foolish analysis on this stock.

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Fool contributor Travis Hoium does not have a position in any company mentioned. You can follow Travis on Twitter at @FlushDrawFool, check out his personal stock holdings or follow his CAPS picks at TMFFlushDraw.

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Read/Post Comments (2) | Recommend This Article (3)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment icon found on every comment.

Report this Comment On October 28, 2011, at 4:26 PM, spokanimal wrote:

Wow, Travis... you left out the launch of Sand's Junket initiative (and it's "waiting list" of interested junkets) and the fact that they achieved what they did in Q3 on poor table hold...
... and you still impressed me.
S
Report this Comment On October 28, 2011, at 4:55 PM, scfneon wrote:

You fools are so flip flop so today you like lvs
Really are you sure.
lol get ready to like MGM and Mel crown and Wynn again also.

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