Las Vegas Sands Corp Stock Buy Recommendation Reiterated (LVS)

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

NEW YORK ( TheStreet) -- Las Vegas Sands (NYSE: LVS) has been reiterated by TheStreet Ratings as a buy with a ratings score of B . The company's strengths can be seen in multiple areas, such as its revenue growth, good cash flow from operations, largely solid financial position with reasonable debt levels by most measures, notable return on equity and expanding profit margins. We feel these strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the ratings report include:
  • LVS's revenue growth has slightly outpaced the industry average of 0.5%. Since the same quarter one year prior, revenues rose by 10.1%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • Net operating cash flow has increased to $750.87 million or 13.22% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -11.94%.
  • LAS VEGAS SANDS CORP's earnings per share declined by 35.5% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, LAS VEGAS SANDS CORP increased its bottom line by earning $1.56 versus $0.50 in the prior year. This year, the market expects an improvement in earnings ($2.36 versus $1.56).
  • Even though the current debt-to-equity ratio is 1.06, it is still below the industry average, suggesting that this level of debt is acceptable within the Hotels, Restaurants & Leisure industry. Despite the fact that LVS's debt-to-equity ratio is mixed in its results, the company's quick ratio of 2.26 is high and demonstrates strong liquidity.
  • The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Hotels, Restaurants & Leisure industry and the overall market on the basis of return on equity, LAS VEGAS SANDS CORP has underperformed in comparison with the industry average, but has exceeded that of the S&P 500.

Las Vegas Sands Corp., together with its subsidiaries, owns, develops, and operates various integrated resort properties primarily in the United States, Macau, and Singapore. The company has a P/E ratio of 26.5, equal to the average leisure industry P/E ratio and above the S&P 500 P/E ratio of 17.7. Las Vegas Sands has a market cap of $37.76 billion and is part of the services sector and leisure industry. Shares are up 7.4% year to date as of the close of trading on Wednesday.

You can view the full Las Vegas Sands Ratings Report or get investment ideas from our investment research center.

--Written by a member of TheStreet Ratings Staff.

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