Gaming's Las Vegas Sands (LVS) (WYNN) (MGM) Not Impressive

Even though there have been what is called "positive" moves to the upside, the gaming industry is anything but healthy, and the recent results from Las Vegas Sands (NYSE:LVS) confirms there are a lot of challenges remaining from the fragile global economy.

When you have to rely on luck like Wynn Resorts (Nasdaq:WYNN) did last quarter to post an even fair quarter, you know there is pressure in a sector.

The quarterly report from MGM Resorts (NYSE:MGM) also had a very small upside surprise, but it isn't anything to get excited about, as the company still lost $0.18 a share.

Las Vegas Sands reported a net revenue increase of only 4.5 percent quarter over last quarter to $2.11 billion and adjusted property EBITDA increased a tiny 0.9 percent to $745.7 million. The numbers weren't even that good though, as an increase in property EBITDA at Four Seasons Macau
made things look a lot better than they were.

Adjusted EPS fell way below analysts' estimates of $0.44, coming in at only $0.37 a share.

Melco Crown (Nasdaq:MPEL) reports its earnings in about two weeks.

Las Vegas Sands was trading at $42.57, falling $3.30, or 7.19 percent, as of 2:15 PM EDT. Wynn Resorts was trading at $142.63, down $3.45, or 2.36 percent. MGM is trading at $14.31, gaining $1.41, or 10.98 percent.

Wynn (WYNN) Pulls Up (LVS) (MGM) (MPEL) (BYD) on Big Earnings Beat

Wynn (NASDAQ:WYNN) gave a boost to competitors Las Vegas Sands Corp. (NYSE:LVS), MGM Resorts International (NYSE:MGM), Melco Crown Entertainment Ltd (NASDAQ:MPEL) and Boyd Gaming Corporation (NYSE:BYD) after hours as it handily beat analysts' expectations.

Net income for Wynn soared to $226.3 million,or $1.38 a share, versus $27 million, or 22 cents a share in the same quarter last year.

Revenue surged to $1.26 billion, a 38.7 jump year-over-year.

Adjusting for one-time items, Wynn earned $1.38 a share, wildly beating the average analyst forecast of 74 cents per share.

Macau continues to be the main revenue and earnings generator in the gaming sector for those with exposure there.

Boyd Gaming Corporation was trading after hours at $8.95, up $0.17, or 1.94 percent. Melco was at $9.88, up $0.16, or 1.65 percent. MGM was trading after hours at $13.54, gaining $0.24, or 1.81 percent. Las Vegas Sands was trading after close at $45.95, rising $0.75, or 1.66 percent. Wynn Resorts closed Tuesday at $138.93, losing $1.57, or 1.12 percent. After hours it jumped to $143.00, soaring $4.07, or 2.93 percent.

Melco Crown (MPEL) Jumps on BofA (BAC) Upgrade

Shares of Melco Crown Entertainment Ltd. (NASDAQ:MPEL) are hopping today on news of an upgrade from Bank of America (NYSE:BAC) from "Neutral" to "Buy."

Melco Crown Entertainment is in the development, ownership, and operation of casino gaming and entertainment resort facilities, for the most part in the Macau special administrative region of China.

Affluent and middle class Chinese gamers continue to spend strongly in Macau.

Melco Crown Entertainment was upgraded by Bank of America on what they see as “sustainable improvement” in the performance of the casino in the midst of increased spending in the region.

Melco was trading at $9.26, gaining $0.57, or 6.56 percent, as of 2:13 PM EDT.

JPMorgan (JPM) Raises (WYNN) (LVS) (MPEL) Estimates

JPMorgan (NYSE:JPM) raised its estimates on Wynn Resorts (WYNN), Las Vegas Sands (LVS) and Melco Crown Entertainment (MPEL) today.

According to JPMorgan analyst Joseph Greff, Wynn and Las Vegas Sands should benefit from expected growth in Macau and the Las Vegas Strip. Gross gaming revenue in Macau has risen by 47.7 percent over last year in February.

For Melco Crown Entertainment, Greff noted that it is trading at a lower valuation than its peers.

Greff said, “We think that mass, slot, and VIP volumes for Marina Bay Sands’ (MBS) 1Q11 showed nice sequential improvements versus 4Q10 levels, something that should improve current investor sentiment for LVS, given that was an issue of concern for investors in the 4Q10 when VIP volumes were down sequentially. We believe that February was an all-time record for volumes and EBITDA.”

“We think Macau GGR growth will remain robust over the next two months given five weekends in April and the seasonally strong Golden Week holiday in May. Additionally, in the near term, we believe the potential easing of foreign labor restrictions in Macau over the next two months (in conjunction with Galaxy Cotai opening on May 15), could serve as a positive catalyst for all Macau operators, and more specifically LVS as it could speed up construction on Sites 5 & 6.”

He boosted his December 2011 price target on WYNN from $140 to $150, and on LVS from $58 to $56.

Wynn Resorts was trading at $135.94, gaining $1.64, or 1.22 percent, as of 12:55 PM EDT. Las Vegas Sands was trading at $45.22, up $0.36, or 0.80 percent. Melco was trading at $8.50, rising $0.26, or 3.16 percent.

Las Vegas Sands (NYSE:LVS) Punished by Over-Stimulated Investors

Shares of companies like Las Vegas Sands (NYSE:LVS), are continuing to get punished even after solid quarterly results and guidance, as investors seem to be overly stimulated by recent unsustainable results, and continue to measure the company by that performance, rather than what can be done in reality over the longer term.

Las Vegas Sands has dropped by over 7 percent in trading Friday on just that type of situation, as investors had such high expectations Las Vegas Sands were almost surely to fall short of them, as they indeed did.

Revenue in the fourth quarter increased by almost 57 percent, while adjusted earnings beat analysts' expectations. That has somehow translated into a disappointing quarter by some being ruled by emotions and hype.

Most of the disappointment came from what appears to be slowing growth in Macau, although that wasn't a surprise to those aware of the impact on the Chinese people when celebrating their New Year.

The Chinese are particularly crucial to the growth prospects for Macau, and have been doing their part in the recent past, but questions have been generated because of what looks like slowing growth.

We won't know if that's really the case or not until the next couple of quarterly reports, to see if there is a pattern developing or it was just a temporary lull.

Also of importance will upcoming reports from MGM Resorts (NYSE:MGM), Melco Crown (Nasdaq:MPEL) and Wynn Resorts (Nasdaq:WYNN), which will give an idea if Las Vegas Sands are losing customers to competitors, or if it's an industry-wide slowdown in some areas.

If they are shown to be doing well, Las Vegas Sands could take another hit, even though they continue to put out decent numbers.

Las Vegas Sands was trading at $46.48, falling $3.80, or 7.56 percent, as of 2:28 PM EST.

Las Vegas Sands (NYSE:LVS) Weighing Options Over Macau Land Decision

After having their application rejected by Macau for two plots of land, Las Vegas Sands (NYSE:LVS) is weighing their options as to how to proceed forward, as they have 15 day in order to apply for a government review of the decision.

Canaccord said, "The casino operator's Chinese subsidiary, Sands China, tumbled in overseas trading after the Macau government rejected its application to develop choice land plots. The rejected bid covers the last two parcels of land that the company planned to develop in the world’s biggest casino center. According to a U.S. regulatory filing on Thursday, Sands China has 15 days to apply for a government review, and 30 days to appeal to the courts in Macau to secure sites 7 and 8 on Macau’s Cotai Strip. “The company has received a letter and is considering its options as presented by the government,” said a Las Vegas Sands spokesperson. If Sands China chooses not to seek a review or loses its appeal, the plot would be open for other companies such as SJM Holdings, Asia’s biggest-listed casino operator, to develop. “We believe SJM, MGM (NYSE:MGM) as well as Melco Crown (Nasdaq:MPEL) are likely candidates who will be keen on exploring any opportunities for that site,” noted an analyst at CLSA Asia Pacific Markets in Hong Kong. In particular, SJM’s “management has expressed that it will consider sites opening up in the market including sites 7 and 8,” he wrote. Wynn's (Nasdaq:WYNN) Macau subsidiary could also be interested in the land, but declined to comment."

Las Vegas Sands closed Monday at $49.02, down by $0.22, or 0.45 percent.