On Friday, JPMorgan (NYSE:JPM) made a bullish move on shares of Las Vegas Sands (NYSE:LVS), raising the price target on the company's shares to $62.00 from $60.00. The firm maintained an Overweight rating on the stock. According to InvestingPro data, the stock appears undervalued based on its Fair Value analysis, with analyst targets ranging from $51 to $66. The adjustment reflects a positive outlook for the company's operations, particularly in Macau.
The analyst from JPMorgan expressed confidence in Las Vegas Sands' future performance, anticipating that disruptions from the Londoner renovation in Macau would significantly decrease. This reduction in disruption is expected to enable Las Vegas Sands to achieve a higher EBITDA growth rate in 2025 compared to its Macau peers.
Las Vegas Sands is projected to reach approximately $2.8 billion in property-level EBITDA in Macau, which would represent a 16% year-over-year growth. The company's current total EBITDA stands at $3.86 billion, supported by an impressive gross profit margin of 76.43%.
The analyst's expectations align with buy-side forecasts, which are considered reasonable. Moreover, the company is expected to continue its steady quarterly share buybacks in the range of $400-$500 million.
The positive sentiment extends beyond Macau, with the Singapore market also offering attractive prospects. The analyst anticipates a 9% growth in the Singapore market for Las Vegas Sands in 2025, following a 13% growth in 2024.
The optimism is bolstered by long-term growth potential stemming from capital expenditure and expansion plans in Singapore, such as the recently announced IR2 capital expenditure. InvestingPro analysis reveals strong momentum with a 23.21% return over the past six months, and highlights 8 additional key insights available to subscribers through their comprehensive Pro Research Report.
In other recent news, Las Vegas Sands Corp. reported strong performance in the third quarter of 2024, primarily driven by its operations in Macao and Singapore. The company's total gaming revenue in Macao rose 13% year-over-year, with mass gaming revenue up by 14%.
The hold-adjusted EBITDA for Macao operations was reported at $583 million, surpassing the Street's expectation. However, the Singapore operations yielded a hold-adjusted EBITDA of $484 million, slightly below the Street's forecast.
Financial firms Mizuho (NYSE:MFG) Securities and Stifel have updated their outlook on Las Vegas Sands Corp., both raising their price targets to $57 and $64 respectively. Mizuho Securities maintained an Outperform rating, while Stifel retained a Buy rating on the stock. These adjustments follow several recent developments, including the opening of the Londoner Grand Casino (EPA:CASP) and the ongoing $1.75 billion refurbishment at Marina Bay Sands in Singapore.
Despite renovation disruptions, Las Vegas Sands Corp. also announced a repurchase of $450 million in stock and an increase in its annual dividend to $1 per share for 2025. These recent developments highlight the company's robust growth and its optimistic outlook for future performance in its key markets.
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