UBS Group released a report stating that according to channel investigation, Macau's mid-casino daily revenue has increased by about 3% quarter-on-quarter since the second quarter, which is believed to be driven by the May Labor Day holiday, while VIP room gambling revenue has dropped by about 6% quarter-on-quarter.
In terms of market share, SJM (00027.HK) continued to grow in May, increasing by 250 basis points per month, pushing market share up by 200 basis points quarter-on-quarter since the second quarter. Sands China (01928.HK) market share remained flat quarter-on-quarter since the second quarter, despite more guest rooms being closed for renovation, resulting in a 150 basis point month-on-month decline in market share in May. MGM China (02282.HK) and Wynn Macau (01128.HK) market share decreased by about 140 and 120 basis points quarter-on-quarter since the second quarter, respectively. Galaxy Entertainment (00027.HK) fell by 50 basis points since the second quarter, possibly due to the impact of satellite casinos.
As for Sands China (01928.HK), its market share remained flat quarter-on-quarter since the second quarter, despite more guest rooms being closed for renovation, resulting in a 150 basis point month-on-month decline in market share in May. MGM China (02282.HK) and Wynn Macau (01128.HK) market share decreased by about 140 and 120 basis points quarter-on-quarter since the second quarter, respectively. Galaxy Entertainment (00027.HK) fell by 50 basis points since the second quarter, possibly due to the impact of satellite casinos.
The bank believes that the current price of Macau casino stocks is equivalent to a forecast enterprise value multiple of about 9.9 times in 2024, which is 1.4 standard deviations lower than the historical average. The bank remains bullish on Macau casino stocks, with New Century (00200.HK) and SJM as its top picks in the industry.
UBS's latest ratings and target prices for Macau casino stocks are as follows:
Stocks | Rating | Target price (HKD)
New Century (00200.HK) | Buy | 7.8
SJM (00027.HK) | Buy | 46.1
Sands China (01928.HK) | Buy | 24.3
Wynn Macau (01128.HK) | Buy | 9.4
Galaxy Entertainment (00027.HK) | Buy | 3.5
MGM China (02282.HK) | Buy | 16.2