Las Vegas Sands is the IBD Stock Of The Day for Wednesday as shares of the casino and luxury resort operator trade in a buy zone.
Las Vegas Sands is coming off its earnings beat from late July, which saw solid growth at its Macao and Singapore properties.
The company reported a 43% increase in earnings to 79 cents per share adjusted, which trounced forecasts for 53 cents per share. Revenue increased 15% to $3.18 billion, clearing expectations for $2.84 billion.
Las Vegas Sands received modest price-target raises on the report, with BofA calling it "an incredible quarter in Singapore," The Fly reported.
Marina Bay Sands, the company's Singapore resort, saw revenue jump nearly 37% to $1.39 billion.
The firm noted that Macao is still working on its turnaround, but Las Vegas Sands is stepping up promotional reinvestments in the region to regain share. BofA believes the initiatives will keep rolling out in Q3, and could start to bear fruit by the end of the year. The firm raised its price target on LVS stock by 2.50 to 55 and kept a neutral rating on the shares.
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Las Vegas Sands' Macao operations saw revenue tick up 2.5% to $1.797 billion in Q2.
JPMorgan gave LVS stock the largest price hike among analysts, lifting its target to 56 from 47 while keeping a neutral rating on the stock.
Meanwhile, Macau's gaming bureau last week reported that gross gaming revenue for July was up 19% year over year, which topped expectations for the fourth month in a row, Bloomberg reported.
Tourism Troubles
But the domestic casino outlook isn't looking like a winning hand. The Los Angeles Times on Monday reported that visits to Sin City were down 11.3% in June from last year, according to data from the Las Vegas Convention and Visitors Authority. Trips from Californians are weighing on performance, as traffic on the California-Nevada border was down 4.3% during that period. Air travel to Las Vegas was down 6.3% from last year.
International tourism is also taking a hit, in part due to President Donald Trump's policies. The World Travel and Tourism Council in May released a report that projects the U.S. will lose $12.5 billion in international travel spending this year.
That's already weighing on MGM Resorts and Caesars Entertainment, which missed revenue estimates for their Las Vegas operations in their recent earnings reports.
Las Vegas Sands Stock
LVS stock climbed less than 1% Wednesday.
The stock is in a buy zone for a cup-with-handle base, after breaking out above the 50.67 buy point on July 24. Shares are forming a shelf in the buy zone, and touching back to test very short-term support at the five-day moving average.
LVS stock is actionable now, or investors could wait to buy after clearing the shelf pattern.
Las Vegas Sands has rallied more than 74% from its April 8 low but is still only up about 2% this year.
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