Gaming Giants Gear Up for Q4 Earnings Amid High Expectations

The gaming industry is entering the fourth-quarter earnings season with heightened anticipation, and all eyes are on key players like Las Vegas Sands, Wynn Resorts, and MGM Resorts. 

Las Vegas Sands Eyes Impressive Q4 Revenues

Las Vegas Sands Corp. is set to release its Q4 2023 results on January 24, post-market close, after surpassing expectations with a 3.8% earnings surprise in the previous quarter. Revenue estimates stand at an impressive $2.9 billion, indicating a substantial 157.6% increase from the year-ago quarter.

In Q4 2023, Las Vegas Sands is expected to experience a surge in revenues, driven by increased visitation in Macao and Singapore, according to Zacks Equity Research. The company’s performance is anticipated to benefit from a robust influx of high-value customers and strength in gaming volumes, retail sales, and hotel occupancy. Projections indicate substantial revenue growth across all segments, including Venetian Macao, Londoner Macao, Parisian Macao, Sands Macao, and Marina Bay Sands.

Despite these positive indicators, challenges such as an increase in gaming tax and inflationary pressures related to material and labor may impact the company’s profit margins in the upcoming quarter.

Meanwhile, Deutsche Bank analyst Carlo Santarelli has increased Las Vegas Sands’ price share target to $66 per share, affirming a “buy” rating and expressing confidence in the company’s growth prospects in Macau and the US. 

However, despite the positive outlook, Santarelli revised cash projections for Sands’ Macau operations in Q4 2023 to $611 million, down $67 million from the initial estimate, citing weak market share in November, increased commissions for junket operators, and higher promotional spending. 

Bank of America Analyst Fuels High Expectations for Wynn and MGM

In addition to Las Vegas Sands, other gaming giants are also set to deliver strong performances. Expectations are high for Wynn Resorts and MGM Resorts, fueled by insights from Bank of America Securities analyst Shaun Kelley. 

Kelley projects a slight beat for MGM and a slight miss for Wynn in adjusted-earnings estimates for the fourth quarter. Despite concerns over China macro trends, he highlights mixed investor sentiment, supported by improving gross-gaming-revenue trends and historical multiples. Kelley’s estimates place Marina Bay Sands in Singapore at $475 million, slightly ahead of consensus. 

A Bank of America’s note acknowledges the industry’s underperformance but expects high-end outperformance in Las Vegas, driven by Formula 1 and baccarat. 

Kelley remains optimistic about digital gaming growth, projecting an 11% gross-gaming-revenue upside for DraftKings in Q4, driven by the successful launch in Kentucky and increased investments behind BetMGM.

Analysts are closely watching the performance of these gaming industry leaders, with hopes that positive earnings reports will set a positive tone for the overall market.