Shares of Las Vegas Sands (NYSE:LVS) are down about 9% since the casino giant released mixed second quarter numbers on July 25th. Its revenue rose 6% annually to $3.3 billion, which beat expectations by $20 million but represented its slowest growth in seven quarters.

Its hold-normalized adjusted earnings per share grew 23% to $0.76 but missed estimates by three cents. On a GAAP basis, earnings rose just a penny to $0.70 per share. Those numbers weren't terrible, but investors were already concerned about trade tensions between the U.S. and China and the abrupt slowdown in Macau's gross gaming revenue (GGR) growth in June.

Las Vegas Sands' properties.

Image source: Las Vegas Sands.

Therefore, Sands had a lot to prove, but it delivered a messy quarter. Should investors take advantage of this dip to buy more shares? Let's take a closer look at the company to find out.

A closer look at Macau

Las Vegas Sands generated 64% of its revenue and 59% of its hold-normalized adjusted EBITDA in Macau during the quarter.

Sands' Macau revenue rose 18% annually to $2.1 billion. Each of its properties in the region enjoyed double-digit growth, with the exception of The Parisian, which saw results hobbled by room conversions to premium suites.

In the first half of the year, Sands' Macau revenue rose 17% -- which was lower than the broad region's 19% GGR growth during the same period, as reported by the Gaming Inspection and Coordination Bureau. This means that if Macau's GGR growth continues to decelerate (as seen in the following chart), Sands might see a tougher slowdown than its higher-growth rivals.

Month

Macau GGR (Billions MOP)

Year-over-year growth

January

26.26

36.4%

February

24.30

5.7%

March

25.95

22.2%

April

25.72

27.6%

May

25.48

12.1%

June

22.49

12.5%

Source: Gaming Inspection and Coordination Bureau.

On the bottom line, Sands' adjusted property EBITDA in Macau rose 25% annually to $750 million (22% on a hold-normalized basis). Its adjusted EBITDA margin also expanded 200 basis points annually to 35.4%.

All in all, the Macau business looks healthy, but the region faces increasingly difficult year-over-year comparisons and remains vulnerable to retaliatory moves by the Chinese government against U.S. businesses. However, Sands believes that new projects in Cotai, the development of Hengqin Island into a commercial zone, and the new Hong Kong/Macau/Zhuhai Bridge will bring in a steady stream of new visitors.

Singapore sinks, raising doubts about Japan

Unfortunately, Sands' other big growth engine in Asia, the Marina Bay Sands in Singapore, reported dismal results. Its revenue tumbled over 15% to $705 million, while its adjusted property EBITDA tumbled 25% (5% on a hold-normalized basis) to $368 million. Sands attributed those declines to a softer rolling volume and win percentage, while a stronger dollar amplified those declines.

The Marina Bay Sands in Singapore.

The Marina Bay Sands in Singapore. Image source: Las Vegas Sands.

Marina Bay Sands' weakness raises some questions about Sands' expansion into Japan. Just as it did in Singapore, Sands plans to expand into Japan with an integrated convention center and casino resort. But that project, which could cost up to $10 billion, already faces proposed time, age, and entrance fee restrictions that could throttle visits from Japanese gamblers.

Missing out on the U.S. market

Lastly, Sands' focus on Asia means that the ongoing recovery in Las Vegas doesn't mean much to the company's overall business. Sands also agreed to sell Sands Bethlehem in Pennsylvania for $1.3 billion earlier this year.

Sands' hold-adjusted property EBITDA in the U.S. rose 23% annually to $106 million during the quarter, but that only accounted for 11% of its total hold-adjusted property EBITDA.

The valuation and dividend

Analysts still expect Sands' revenue and earnings to rise 7% and 19%, respectively, this year. The stock doesn't seem that expensive at just under 19 times forward earnings, and the company pays a hefty forward dividend yield of 4.1%.

I own shares of Sands, but I have mixed feelings about its future. I don't plan to sell my shares yet, but I'm reluctant to recommend it as a new investment due to the deceleration in Macau, threats of regulatory interference, and the troubles brewing in Singapore.

Leo Sun owns shares of Las Vegas Sands. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.