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Las Vegas Sands Drawing a Crowd

For the nine months through September, the operating company that essentially will become The Las Vegas Sands Corp. earned $12.5 million on $832.7 million in net revenue.

With its big Las Vegas properties, the company competes with MGM Mirage (MGG), which is working to close its acquisition of Mandalay Resort Group (MBG), and Harrah's Entertainment (HET), which is in the process of acquiring Caesars Entertainment (CZR - Get Report).

"Through these consolidations, the sector has been very hot, which should give Las Vegas Sands an extra boost when it hits the market," wrote analysts at Renaissance Capital's (Neither Renaissance nor its analysts have stakes in Las Vegas Sands, and Renaissance does not do business with the company. Renaissance may acquire shares once Las Vegas Sands goes public.)

But Las Vegas Sands is also working hard across the Pacific. Its Sands Macao Casino opened in May in the former Portuguese colony, now part of China. The city is the only Chinese location that permits casino gambling. The company also plans to build a Macao version of The Venetian by 2008 for $1.8 billion.

Its Macao business also makes it a close competitor with casino tycoon Steve Wynn's Wynn Resorts (WYNN - Get Report).

"Las Vegas Sands' closest comparable competitor may be Wynn Resorts," the Renaissance analysts wrote, noting Wynn plans to open a high-end luxury casino across from The Venetian early next year and a Macao casino in 2007. The analysts believe there may be upside to Las Vegas Sands' current price range, given Wynn's valuation.

Although Renaissance is bullish overall on the IPO and calls it a "golden opportunity," its analysts do have some concerns. "After the construction of its two developing properties, the company will still be dependent on a handful of entities in only two markets," they wrote. "Additionally, there are some operating risks associated with Macao, including gaming concession restrictions and travel restriction by the Chinese government."

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