Las Vegas Sands Corp. (LVS) Is Still Gaming King

To buy or not to buy?

Despite the drop in shares today, I think this was a pretty good quarter for Las Vegas Sands Corp. (NYSE:LVS). The company is growing steadily in Macau, and disappointing results in Singapore and Las Vegas were both affected by lower-than-expected winning percentages. That will adjust over time, and even though Singapore may not be as big as Adelson once expected, it’s still an amazingly profitable casino.

My only reservation with the stock is its price. Las Vegas Sands’s enterprise value is 12.3 times EBITDA, which is well higher than a 9.5 ratio for Wynn, and 9.8 for MGM Resorts. Melco Crown is higher at 13.8 times EBITDA, but it’s a smaller company, and will double the number of casinos it owns in the next three years, so it’s harder to compare against.

Las Vegas Sands does have The Parisian under construction and should be completed near the end of 2015. It’s also working on Eurovegas in Spain, which could initially be a $7.9 billion investment. These will drive growth but, in my opinion, they won’t create enough growth to command a 20% premium over competitors, which also have new resorts in the works. If the stock falls 10% or so, I think it would be a great buy; but at the moment, it’s fairly priced with growth baked in.

The article Las Vegas Sands Is Still Gaming King originally appeared on Fool.com and is written by Travis Hoium.

Fool contributor Travis Hoium manages an account that owns shares of Wynn Resorts, Limited. The Motley Fool has no position in any of the stocks mentioned.

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