Sands China is facing a challenging landscape for the fourth quarter of 2024, as Deutsche Bank has revised its estimates downward in light of lower-than-expected gross gaming revenue (GGR) from Macau and a decline in GGR market share.
Continued property disruptions in Macau are also anticipated to persist through the first quarter of 2025, with Deutsche Bank’s latest assessment indicating that the 4Q24 GGR for Macau was approximately $120 million lower than previous forecasts.
The brokerage revealed that LVS’s market share for November and December slipped from the typical range of 23-24 percent to between 22-23 percent, contributing significantly to the negative revisions.
As a result, Sands China’s property EBITDA for 4Q24 has been lowered by about 9 percent, falling to $566 million from an earlier estimate of $620 million, and below the consensus expectation of $624 million.
Looking ahead, the bank expressed concerns that the consensus forecasts for 2025 appear overly optimistic, providing little margin for error. Deutsche Bank believes that LVS shares would benefit from a “deck-clearing” revision for 2025 estimates.
This adjustment would allow for potential market share gains as normal operations resume at The Londoner, which could serve as a positive driver instead of a requirement for meeting current expectations.
The forecast for Sands China’s 2025 Macau property EBITDA has been adjusted to $2.63 billion, representing a 3 percent decrease from prior estimates and significantly lower than the consensus figure of $2.81 billion.
Deutsche Bank noted that the market seems to be pricing in a return to 2023 market share levels of around 26 percent, a perspective they consider too aggressive given the ongoing disruptions and the extended timeline for projects at The Londoner.