gamblers still want to indulge<\/a>, leading to pent-up demand to visit the peninsula. Speaking of travel controls, the bank sees upcoming catalysts for concessionaires.<\/p>\n<\/div>\n\u201cUpcoming catalysts include reinstatement of Individual Visit Scheme (IVS) self-service kiosks, consumers getting used to being tested or availability of vaccine, and opening of the Hong Kong border without quarantine,\u201d according to Morgan Stanley.<\/p>\n
Guangdong province resumed issuance of IVS permits in late August, with the rest of the mainland joining a month later. But it’s taking a while for that policy to bear fruit for Macau operators. That’s because would-be visitors have to apply for the licenses in person and must present a nucleic acid test no more than seven days old proving they’re COVID-19 negative to gain access to the casino hub.<\/p>\n
Improving Margins<\/h2>\n
As was expected, Macau operators of all stripes delivered dismal third-quarter financial results. But the positive takeaway from the conference calls is that the companies broke even on the basis of earnings before interest, taxes, depreciation and amortization (EBITDA) in October, and are trending EBITDA positive this month.<\/p>\n
That could set the stage for upside in 2021, particularly with many Macau gaming equities now attractively valued.<\/p>\n
\u201cCompanies have cut their operating expenses meaningfully, suggesting a higher EBITDA margin in 2021\/22, which will also be helped by mix change (towards mass). Finally, valuation of 11x enterprise value\/EBITDA on 2019 actual suggests upside (long term average of 12.5x),\u201d <\/strong>said Morgan Stanley.<\/p>\n","protected":false},"excerpt":{"rendered":"A rebounding Chinese economy and pent-up demand are among the catalysts that could hasten 2021 recoveries for Macau gaming stocks, Morgan Stanley analysts said today in a note to clients. Six concessionaires, including three US-based companies, operate in the special administrative region (SAR). But the bank sees two standouts heading into the new year — […]<\/p>\n","protected":false},"author":46,"featured_media":156461,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[69069,62],"tags":[],"acf":[],"yoast_head":"\n
Macau Gaming Stocks Poised to Rebound in 2021, Says Morgan Stanley<\/title>\n\n\n\n\n\n\n\n\n\n\n\n\n\t\n\t\n\t\n\n\n\n\n\n\t\n\t\n\t\n