There's only one company that has a presence in the top three gambling markets in the world, and that is Las Vegas Sands
But shares have struggled recently. So far this year, Las Vegas Sand's stock is down 14%, while Macau competitor Melco Crown
Growing like a weed
With Las Vegas gaming in the dumps and Singapore locked up until 2017, Macau is the only big gaming market expanding right now. If we include MGM Resorts
The new casino on Sites 5&6 will include three towers located next to Melco's City of Dreams and across the street from The Venetian Macau and Four Seasons Macau. The prime Cotai Strip location will add to a stable of profitable casinos and solidify Las Vegas Sands' position as the dominant player in the market.
If there's one thing CEO Sheldon Adelson has mastered, it's the art of squeezing every penny possible from his casinos in Macau. In the first quarter, Sands' casinos had an EBITDA margin of 33.4%, besting Wynn at 31.5% and miles ahead of Melco Crown at 15%. Include Marina Bay Sands in the mix, and the picture gets better. Singapore's low tax rate and packed casino resulted in an astonishing 48.6% EBITDA margin at Marina Bay Sands in the first quarter.
But the best reason to buy Las Vegas Sands now is the company's improving value. The falling stock price has left the company with a 13.6 trailing enterprise value/adjusted EBITDA ratio, on par with Wynn Resorts as least expensive of the four operators. But that doesn't include a full year of operations in Singapore or account for the growth that Sites 5&6 will supply. All told, Las Vegas Sands is flat out the best value in gaming.
Foolish bottom line
Early in 2011, I was high on Melco Crown because it was the best value in gaming, but the tides have turned. Las Vegas Sands is looking much more attractive, and as the company executes a deleveraging strategy, its risks will diminish as well. Do you agree that Las Vegas Sands is a great buy right now? Leave your thoughts in our comments section below. And be sure to follow gaming stocks in My Watchlist to keep track of our Foolish analysis.