Two analysts took significantly different positions on Las Vegas Sands  (LVS - Get Report) in notes to investors today, with Gabelli saying that the risk/reward ratio for Macau casino stocks is favorable and Barclays downgrading Sands based on a worse than expected outlook for Macau.

BULLISH TAKE: Noting that Macau casino stocks recently bounced off of multi-year lows, Gabelli analyst Adam Trivison believes that their risk/reward ratio in the space is now positive. The analyst initiated coverage of three names in the sector - Las Vegas Sands, MGM Resorts  (MGM - Get Report) and Wynn Resorts  (WYNN - Get Report) - with Buy ratings. Trivison concedes that Macau casino stocks are facing multiple headwinds, including the Chinese economic slowdown and weak Chinese VIP gambling. However, he believes that recent comments by Chinese and Macau government officials indicate that the governments are becoming "more supportive" towards Macau casinos. Moreover, new casinos opening in the Cotai area of Macau "will create critical mass" in that area, boosting the fortunes of Las Vegas Sands, Wynn, Melco Crown  (MPEL) and MGM, which have casinos there, the analyst believes. Trivison is upbeat on Macau's longer term outlook and believes that the stocks' current valuation "more than compensates" for the risks to their earnings.

BEARISH TAKE: Barclays analyst Felicia Hendrix downgraded Las Vegas Sands to Equal Weight from Overweight, as she now now expects Macau gross gaming revenue to drop 5% in 2016, versus her previous forecast for a 3% increase. Among the reasons she cited for the change in her outlook were continued declines in VIP gambling and the coming launch of new casinos in Macau, which she believes will cannibalize existing properties. Hendrix reduced her price target on Las Vegas Sands to $45 from $55.

PRICE ACTION: In early trading, Las Vegas Sands fell nearly 2% to $47.91, Wynn slipped 0.5% to $66.07, Melco Crown dipped 0.5% to $17.75 and MGM declined 2.2% to $21.22.

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