UPDATE: Macau Gaming Stocks Rise as Analysts Boost Outlook

(updated to add commentary from Morgan Stanley)

Macau stocks are higher following positive analyst comments from Morgan Stanley and Nomura, which both raised their outlook.

Nomua analyst Harry Curtis estimated daily GGR improved to a better-than-expected MOP814mn last week, up 8% sequentially vs. our est. for the prior week.

By segment, MTD they estimate that: 1) average daily VIP volume is up ~8% sequentially vs. the average in December; 2) VIP hold % is ~3.1-3.2% (vs. the “normalized” hold rate of 2.85%); and 3) Mass GGR/day is tracking roughly flat vs. last month.

On Monday Morgan Stanley analyst Thomas Allen commented that the outlook for 2018 remained positive and believs Macau is still a favorite idea with an attractive MGM set up. The analyst commented in a Monday note "WYNN remains our top pick as we start 2018, driven by what we expect will be continued Macau and Macau market share outperformance. MGM, after underperforming in 2017, is our next favorite stock with cash flow turning into a tailwind in 2018. Remain Equal-weight Regionals and REITs."

Allen raised his 2018 revenue forecast for Macau to 16% from 11% previously citing stronger visitation data and spending. The analyst also noted an expectation for Las Vegas strip revenues to continue to grow in the low-single digits.

Related Stocks:

Las Vegas Sands (NYSE: LVS)
MGM Resorts (NYSE: MGM)
Melco Resorts & Entertainment Limited (NASDAQ: MLCO)
Wynn Resorts Ltd (NASDAQ: WYNN)

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