Las Vegas Sands Tanks on SEC Investigation

(Las Vegas Sands article updated with analyst commentary.)

NEW YORK ( TheStreet) -- Las Vegas Sands ( LVS) is in the red Tuesday afternoon, after it received a subpoena request from the Securities and Exchange Commission requesting the company provide compliance documents related to the Foreign Corrupt Practices Act.

The casino giant also noted that it is the subject of an investigation by the Department of Justice.

Las Vegas Sands said it is fully cooperating with the government and providing all documentation with respet to its Macau operations and dealings with the government going back several years.

Analysts believe these allegations stem from claims made by former Sands China CEO, Steve Jacobs, regarding the bribing of officials. Las Vegas Sands has publicly denied these allegations.

Jacobs has alleged that he was fired from the company in July 2010 without cause after refusing to carry out demands made by Las Vegas Sands CEO Sheldon Adelson.

"While handicapping the end results of investigations of this sort are nearly impossible, we believe the headline risk will serve as an overhang on shares in the near term until more on the matter is known," Wells Fargo analyst, Carlo Santarelli, wrote in a note. "That said, we believe the Jacobs lawsuit has quietly been a drag on shares in recent months given the nature of the claims and the potential for something like this to occur."

Sands' Macau concession should not be affected, Sterne Agee analyst David Bain, noted.

In short, this could be a non-event or end up having a significant financial impact.

But despite the uncertain outcome, J.P. Morgan analyst Joseph Greff says he would be a buyer of Sands on today's downturn.

Bain also retains his buy rating on the stock and price target of $60. "Our main concern is that we believe the investigation does not show well to other foreign markets where Las Vegas Sands may be attempting to gain foothold."

Adelson said earlier in the month that he is eying developing a Las Vegas Strip style casino in Spain, and analysts have been speculating about potential growth in Japan.

Shares of Sands are tumbling 7.5% to $43.14 in midday trading.

--Written by Jeanine Poggi in New York.

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