Casino stocks extend recent losses as Macau traffic declines after the National Day holiday, and industry's Q3 EBITDA may fall sequentially
AInvestTuesday, Oct 15, 2024 10:40 pm ET
1min read
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Shares of gaming stocks continued their recent decline, with Galaxy Entertainment (00027) falling 4.33% to HK$34.25; MGM China (02282) down 3.28% to HK$10.04; Wynn Resorts (01128) down 2.56% to HK$6.09; and SJEC (01928) down 2.47% to HK$18.16 at the time of writing.

HSBC published a research report stating that Macau's first 13 days of October saw gaming revenue of Rmb11bn, implying an average daily revenue of Rmb643mn, down 42% from the previous week. The related performance was partially due to a decrease in traffic after the Golden Week holiday in October, which was consistent with the average 40% decline in the second week of October after the previous Golden Week. The bank expects Macau's total gaming revenue in October to be between Rmb21.4bn and Rmb22.3bn, up 24% to 29% month-on-month, and 81% to 84% of the level in October 2019.

Macquarie published a research report that cut its third-quarter gaming revenue and EBITDA forecasts for Macau by 5% and 8%, respectively, due to the overall decrease in promotional activities and the impact of the macro economy on demand. CICC's research report pointed out that gaming stocks will start to announce their third-quarter results at the end of October. As Macau's third-quarter gaming revenue fell 1.5% month-on-month, and the margin continued to be under pressure, the brokerage expects the industry's Ebitda to fall 10% to US$1.748bn month-on-month.

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