01128 Overview

Macau's GGR Performance: Macau's gross gaming revenue (GGR) for February increased by 4% year-on-year to MOP20.6 billion, exceeding market expectations, with a notable surge in the last week of February driven by high-end customer demand.

Investor Recommendations: JPMorgan advised investors to be selective, favoring GALAXY ENT with a target price of HKD52, while rating SJM HOLDINGS and MELCO INTERNATIONAL DEVELOPMENT as Underweight with lower target prices.

Macau Casino Performance: The Lunar New Year performance for Macau casinos was moderate, raising concerns from Morgan Stanley about profit pressures due to promotional activities, despite better GGR performance compared to other Chinese consumers.

Positive Financial Indicators: Continuous growth in cash flow and dividends makes casino valuations attractive, with no AI risks impacting the sector.

Broker Recommendations: CLSA predicts a 7.4% YoY increase in February GGR due to a stronger-than-expected visitor influx, favoring GALAXY ENT and SANDS CHINA for their high dividends.

Morgan Stanley Ratings: Morgan Stanley's ratings for Macau casinos include "Overweight" for SANDS CHINA, GALAXY ENT, WYNN MACAU, and Melco Resorts, while SJM HOLDINGS is rated "Underweight" due to potential EBITDA fluctuations.

Macau's GGR Performance: Macau's gross gaming revenue (GGR) for the first 22 days of February reached MOP14.3 billion, averaging MOP786 million per day, with a notable increase during the Chinese New Year Golden Week.

Daily GGR Trends: The average daily GGR was initially sluggish but accelerated to MOP1.2-1.3 billion in the last three days of the period, reflecting a 10-15% increase compared to the same timeframe last year.

Citi's GGR Forecast Adjustment: Citi has lowered its GGR forecast for Macau in February to MOP19.5 billion, indicating a more cautious outlook.

Stock Performance Overview: The report includes stock performance data for major gaming companies in Macau, highlighting short selling ratios and price changes for companies like Galaxy Entertainment, MGM China, Sands China, SJM Holdings, and Wynn Macau.

Macau's GGR Performance: Macau's gross gaming revenue (GGR) for the first 22 days of February reached MOP14.3 billion, with a daily average of MOP650 million, falling short of JPMorgan's expectations during the Lunar New Year period.

Forecast Adjustments: Due to mixed performance, JPMorgan revised its February GGR forecast to a flat to 2% increase year-on-year, down from a previous estimate of 2-5% growth, while maintaining a 12-13% growth expectation for the first two months of 2026.

Casino Stock Preferences: JPMorgan updated its preference order for Macau casino stocks, ranking Galaxy Entertainment as the top pick, followed by MGM China and Sands China, all rated Overweight, while Melco Resorts and SJM Holdings were rated Underweight.

Market Reactions: The report noted a decline in casino stocks, with Sands China slipping 2.5% after Citi cut its GGR forecast, reflecting broader market concerns about the gaming sector's performance.

Macau GGR Performance: UBS reported that Macau's average daily Gross Gaming Revenue (GGR) during the Lunar New Year holiday was approximately MOP786 million, falling short of market expectations of MOP900-950 million, although it accelerated towards the end of the holiday.

Year-on-Year Comparison: The GGR run-rate increased to MOP1.2-1.3 billion per day in the last three days of the holiday, marking a 10-15% year-on-year increase, but the average daily GGR for the month to date remains down about 8% year-on-year and 11% month-on-month.

UBS Stock Recommendations: UBS identified Melco Resorts, WYNN Macau, and MGM China as top picks in the Macau gaming sector, with all receiving a "Buy" rating and specific target prices set for each stock.

Investment Ratings Overview: The report includes investment ratings and target prices for various Macau gaming stocks, with Melco Resorts at US$9.5, WYNN Macau at HK$8.9, MGM China at HK$18.5, and Galaxy Entertainment at HK$46.9, among others.

Macau Gaming Industry Performance: The Macau gaming industry has started the year positively, with a record average wager per player of HKD29,625, marking a 13% increase compared to the previous year. Citi forecasts a 1% year-over-year growth in Macau's GGR to MOP20 billion for February.

Visitor Influx Impact: CLSA anticipates a 7.4% year-over-year increase in February GGR due to a stronger-than-expected influx of visitors during the Golden Week.

Stock Ratings and Recommendations: Citi maintains an optimistic outlook on the Macau gaming market, favoring stocks like GALAXY ENT, MGM CHINA, and SANDS CHINA, while rating SJM HOLDINGS as a sell.

Short Selling Data: The report includes short selling data for various companies, indicating varying levels of short interest, with SANDS CHINA showing the highest short selling ratio at 29.547%.