Gaming Giants Gear Up for Q4 Earnings Amid High Expectations

Las Vegas Sands Corp. is gearing up to unveil its Q4 2023 results on January 24, after exceeding expectations with a remarkable 3.8% earnings surprise in the previous quarter. Revenue estimates for this quarter are an astounding $2.9 billion, indicating a substantial 157.6% increase from the same period last year.

In Q4 2023, Las Vegas Sands is poised for a revenue surge, thanks to higher visitation rates in Macao and Singapore, as noted by Zacks Equity Research. The company is expected to benefit from an influx of high-value customers, strong gaming volumes, increased retail sales, and higher hotel occupancy rates. Projections suggest significant revenue growth across all segments, including Venetian Macao, Londoner Macao, Parisian Macao, Sands Macao, and Marina Bay Sands.

Nevertheless, potential challenges such as rising gaming taxes and inflation-related pressures on materials and labor could impact the company's profit margins in the coming quarter.

Deutsche Bank analyst Carlo Santarelli remains bullish on Las Vegas Sands, raising the price share target to $66 per share and maintaining a "buy" rating. Santarelli expresses confidence in the company's growth prospects in Macau and the US.

However, despite the positive outlook, Santarelli has revised cash projections for Sands' Macau operations in Q4 2023 to $611 million, down $67 million from the initial estimate. He cited weak market share in November, increased commissions for junket operators, and higher promotional spending as contributing factors.

Apart from Las Vegas Sands, other gaming giants like Wynn Resorts and MGM Resorts are also expected to deliver strong performances. Bank of America Securities analyst Shaun Kelley predicts that MGM may slightly surpass earnings estimates for the fourth quarter, while Wynn may slightly fall short. Despite concerns about China's macro trends, Kelley points to mixed investor sentiment, supported by improving gross gaming revenue trends and historical multiples. Kelley's estimates place Marina Bay Sands in Singapore at $475 million, slightly ahead of consensus.

Bank of America's note acknowledges the industry's recent underperformance but expects high-end performance in Las Vegas, driven by Formula 1 and baccarat. Kelley remains optimistic about digital gaming growth, projecting an 11% gross gaming revenue increase for DraftKings in Q4, driven by a successful launch in Kentucky and increased investments in BetMGM.

Analysts are closely monitoring the performance of these gaming industry leaders, with hopes that positive earnings reports will set a positive tone for the overall market.