Gaming company Las Vegas Sands (
) reported both its quarterly and annual results Wednesday
afternoon; the firm had
massive profits thanks to strength from its casinos
[caption id="attachment_76902" align="alignright" width="300"
caption="The Sands Macau"]
The company earned $434.8 million, or 53 cents per share for the
quarter, up from $320.1 million, or 39 cents per share, in the same
period last year.
Fourth quarter net income jumped 35%.
Sands China, the company's Macau division, saw its quarterly
profits jump 52% and revenues jump 48%.
After a relatively tough year in 2012 when Asian economies
slowed, the company's recent performance in Macau is indicative of
a rebounding Chinese consumer as the Mainland economy (
) continues to strengthen. As we've noted here at Emerging Money,
casino stocks are well poised to take advantage of Chinese
consumers with discretionary income.
While many Macau-based casinos have concentrated most of their
efforts the on lucrative VIP segment, Las Vegas Sands has
diversified operations by trying to
target the mass market
in addition to high-rollers.
In addition to its incredibly successful Venetian complex, the
company's newest offering, the Sands Cotai Central, attracted more
than three million visitors in 2012. With the company's plans to
build a Paris-themed casino, Las Vegas Sands should be able to
maintain its pole position in the mass-market segment of Macau
After beating estimates, Las Vegas Sands' stock jumped 5%
after-hours. While the company remains reasonably valued trading at
roughly 17 times forward earnings, the stock has been on quite a
run recently: Las Vegas Sands is up 15% over the past month and 40%
over the past six-months.
Although the company remains a compelling long-term story, the
stock has traded consistently for the past few years. The stock has
previously found strong resistance in the 55-62 range, frequently
pulling back before finding support in the low 40's or high
If the stock were to break through 62, Las Vegas Sands could
trade much higher; however, an inability to get above 62 could be a
signal that the stock will eventually move back down to previous
support when a new long position offers a more favorable
Disclosure: Author and family are long LVS; author may sell
covered calls in the next 72 hours.