NEW YORK (TheStreet) -- Shares of Las Vegas Sands (LVS) are declining, down 0.66% to $55.74 in early market trading Wednesday, after the casino company had its price target lowered to $60 from $67 this morning by analysts at FBR Capital Markets.
Analysts at the investment firm cited the 20% decline in Macau gross gaming revenue in November as well as a "soft" first week of December. Macau is the only region in China where casinos are legal.
FBR says that despite reduced investor expectations, it remains "wary" of Macau exposure giving a lack of visibility into a bottom.
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FBR analysts also cuts its estimates for two other casinos, MGM Resorts (MGM) and Wynn Resorts (WYNN) . The firm lowered its price target for MGM to $30 from $35, and cut its price target for Wynn to $165 from $195.
Separately, TheStreet Ratings team rates LAS VEGAS SANDS CORP as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:
"We rate LAS VEGAS SANDS CORP (LVS) a BUY. This is driven by a number of strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its growth in earnings per share, expanding profit margins, good cash flow from operations, largely solid financial position with reasonable debt levels by most measures and notable return on equity. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- LAS VEGAS SANDS CORP has improved earnings per share by 9.2% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, LAS VEGAS SANDS CORP increased its bottom line by earning $2.79 versus $1.85 in the prior year. This year, the market expects an improvement in earnings ($3.53 versus $2.79).
- 46.68% is the gross profit margin for LAS VEGAS SANDS CORP which we consider to be strong. It has increased from the same quarter the previous year. Along with this, the net profit margin of 19.01% is above that of the industry average.
- Net operating cash flow has slightly increased to $1,226.65 million or 7.92% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -17.68%.
- Even though the current debt-to-equity ratio is 1.38, 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 1.78 is high and demonstrates strong liquidity.
- Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. In comparison 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 greatly exceeded that of the S&P 500.
- You can view the full analysis from the report here: LVS Ratings Report