Casino stocks were rising across the board Monday following a cautiously bullish note on the gaming sector from Jefferies analyst David Katz.
Shares of Wynn Resorts (WYNN - Get Report) are up 5.6% to $117.20, while shares of Las Vegas Sands (LVS - Get Report) jumped more than 4% to $58.37 and (MGM - Get Report) Resorts shares jumped 5.8% to $27.80.
"The Macau-oriented stocks in our coverage will ultimately need accelerating GGR growth
to perform well, which at the moment is predicated on the outcome of U.S.-China trade
negotiations," Katz wrote in his note. "We expect there should be progress in the coming weeks, which would shift the market's perspective on Macau and on WYNN and LVS. We expect a neutral to modestly positive reaction to the update in the shares."
The firm's checks suggest that gross gaming revenue for June will range between a 1% decline to a 2% increase year over year. For the year, the firm estimates 10% gross gaming revenue growth.
"Ultimately, we believe that WYNN has the greatest leverage -- financial and operating --
to an inflection in the Macau market, while LVS should be a strong beneficiary as would
MGM based on its newly positioned Cotai property," Katz wrote.