Is It Still A Safe Bet To Buy Stock In Las Vegas Sands?

| + More Articles
  • Like on Facebook
  • Share on Google+
  • Share on LinkedIn

With shares of Las Vegas Sand (NYSE:LVS) trading at around $43.65 is LVS an OUTPERFORM, WAIT AND SEE, or STAY AWAY? Let’s analyze the stock with the relevant sections of our CHEAT SHEET investing framework:

C = Catalyst for the Stock’s Movement

Las Vegas Sands has been up 8% since the announcement for a special dividend. This type of performance is a common trend for companies that make a special dividend announcement. There is a long-term cost, but traders don’t care. One way to play it is to get on board once the special dividend is announced, then sell prior to the shareholder deadline. This protects you from any downfalls on the issue date. In this case, you missed the boat. However, if you would like to receive the special dividend, the shareholder deadline is December 10, 2012. The issue date of a $2.75 special dividend is December 18. 2012.

Some people might want to stay away from this opportunity because it could have an impact on the overall business. That would likely be a mistake. Overall revenues for the gaming industry were up 8% in November in Macau. The key here is that Las Vegas Sands in the leader in Macau. The reason Macau does so well is because it’s the only place to legally gamble in China. Therefore, even if China suffers from a hard landing, Macau will still perform well.

Las Vegas Sands also operates in the United States and Singapore. In regards to the former, its most popular property is The Venetian. If you have never been there, it’s well worth a visit. The interior décor is phenomenal, the restaurants are exceptional, and they have the best poker room in Las Vegas. Las Vegas Sands has also been taking market share away from Atlantic City with its Sands Casino Resort in Bethlehem, PA. If you look at the big picture, this company is strategically building an empire.

E = Equity to Debt Ratio is Normal

Let’s take a look at how Las Vegas Sands stacks up against its competitors when it comes to debt-to-equity ratio and cash vs. debt.

Debt-To-Equity

Cash

Long-Term Debt

LVS

.90

$3.75 Billion

$9.50 Billion

MGM

1.49

$2.44 Billion

$13.83 Billion

WYNN

8.17

$2.53 Billion

$5.87 Billion

 

T = Technicals on the Stock Chart Are Strong

Las Vegas Sands has outperformed MGM Resorts International (NYSE:MGM) and Wynn Resorts (NASDAQ:WYNN) over the past three years. Las Vegas Sands and Wynn Resorts are on a relative playing field whereas MGM is lagging way behind.

1 Month

Year-To-Date

1 Year

3 Year

LVS

1.41%

11.09%

3.15%

194%

MGM

-.78%

-2.49%

-.20%

-5.92%

WYNN

.53%

11.54%

4.08%

111%

 

At $46.75, Las Vegas Sands is currently trading slightly higher than its 50-day SMA of $44.89. It’s trading moderately higher than its 100-day SMA of $43.00. And it’s trading very close to its 200-day SMA of $47.46.

 E = Earnings Are Steady and Revenue Is Excellent

Las Vegas Sands has been growing at a rapid pace. The annual revenue growth is…

More Articles About:

To contact the reporter on this story: staff.writers@wallstcheatsheet.com To contact the editor responsible for this story: editors@wallstcheatsheet.com

Yahoo Finance, Harvard Business Review, Market Watch, The Wall St. Journal, Financial Times, CNN Money, Fox Business