Glonghui, December 13 | UBS published a research report saying that the valuation of Macau gaming stocks is not high, and there is plenty of room for revenue growth, but due to the base effect, the growth rate will be slow, maintaining a positive view of the industry next year. The bank expects gambling revenue to continue to grow next year, driven by new hotels and transportation capacity and increased activity channels throughout the year. Considering rising operating expenses and a weak macro environment, the bank maintained next year's midmarket gambling revenue forecast at 105% of 2019 levels, meaning a 15% increase over the year. However, it lowered the EBITDA recovery rate from 102% of the 2019 level to 86%, mainly due to an increase in operating expenditure estimates. According to the bank, Bank Entertainment (0027.HK) and MGM China (2282.HK) are the first choice in their industry. The bank believes that the weak macroeconomic economy has reduced the gaming penetration rate compared to 2019. China's increase in outbound flight capacity may move some high-end customers from Macau to other regions, but lower ticket prices may prompt low and medium consumer travelers to return to Macau. The bank said that since the license's investment promises may offset the costs cut by the company's layoffs, it is expected that next year's industry operating expenses may be the same as in 2019.