Las Vegas Sands Upgraded at Wells Fargo on Attractive Singapore Momentum
2022.07.21 20:58
Las Vegas Sands (LVS) Upgraded at Wells Fargo on Attractive Singapore Momentum
By Sam Boughedda
American casino and resort company, Las Vegas Sands (NYSE:LVS), was upgraded to Overweight from Equal Weight by a Wells Fargo analyst on Thursday.
Following the report, the company’s shares are trading 7% higher.
Wells Fargo’s price target on the stock was also increased to $45 per share from $43, implying a 20% upside from current levels.
The analyst pointed to three reasons for the upgrade: “(1)attractive momentum in Singapore, where 2Q mass table/slot GGR has quickly reached 90%+ of ’19 levels despite visitation/airlift still at/below 50% of ’19, (2) Macau expectations can’t get much worse, with no realistic line of sight to COVID zero/travel restrictions being eased (best case, year-end?), (3) valuation: we est. Singapore/Non-Macau is conservatively worth $25/sh (13x $1.75b 2024E EBITDA, discounted back) vs. its implied ~$21/share (LVS trades at $37, less $17 for 70% of 1928 HK).”
The analyst said that assuming Macau is worth $17 per share, it implies an 8x multiple on their 2024E Macau EBITDA of $2.8b, which “while a guesstimate (at best), is 5x below 1928 HK’s historic 13.4x, a reasonable discount for assets in a highly attractive, albeit now frustratingly opaque market.”
