The growing number of people visiting the Las Vegas is starting to pay off for casino companies at the gaming tables. The Nevada Gaming Control Board reports that gaming win was up 9% in November to $495.2 million, driven by baccarat play.
MGM Resorts (NYSE: MGM), Wynn Resorts (Nasdaq: WYNN), and Las Vegas Sands (NYSE: LVS) have been relying on Macau growth in recent years because gaming has been slow to recover in Las Vegas. But recent months have shown strong growth in gaming win for casinos and a slow but steady recovery. For the first 11 months of 2011, gaming win was up 5.2% on the strip.
An even more positive sign is the strong volume of traffic heading to Las Vegas. The number of people visiting Las Vegas grew for the 21st straight month in November, and they're opening their wallets even when they aren't gambling.
Nevada resorts earned 34.1% of revenue from food, beverage, and other offerings while gaming revenue sank to 46.2% of overall revenue, a record low. This diversification has been a long trend in Las Vegas as nightclubs, pool parties, and room revenue have become more important to the bottom line.
If traffic numbers continue to rise and players continue to gamble, casino companies may not have to look at Las Vegas as a black eye on their portfolio.
Trouble brewing at Wynn Resorts
Wynn Resorts is running into some trouble today after a major shareholder sued the company.
Kazuo Okada sued the company because it had refused to let him review business accounts. The account in question is a $135 million donation the company made to the University of Macau, which Okada called "inappropriate."
I had the same questions when the donation was announced, although I said it "left me scratching my head." The suit is made even stranger because Okada is a director with the company, and you'd think he would have access to records about such a big transaction.
I don't think the lawsuit changes the investment thesis, though, and I view the donation as part of doing business in Macau, but it might hang over the stock in the short term.
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