Macquarie Keeps Outperform On Las Vegas Sands, Sees Upside From Current Prices

In a report published Thursday, Macquarie analyst Chad Beynon maintained an Outperform rating on Las Vegas Sands Corp LVS, with a price target of $60. Analyst Chad Beynon pointed out that Las Vegas Sands reported decent 2014 results against an "extremely difficult backdrop in Macau." Promotional and marketing cuts enabled the company to post robust Macau margins. The company's diversified business model sets it apart from its peers who are expected to face higher operating leverage pressure, the Macquarie report mentioned, while adding that the company's adjusted EPS of $0.61 "will be strong enough to support the stock." Las Vegas Sands maintained its annual dividend and repurchased stock. "With an annual dividend of $2.60, which currently represents a 4.7% yield, and buyback capabilities of $1.8 billion, we believe management is rewarding shareholders for weathering the Macau storm. However, we still caution that this takes risk, given gov't intervention and Asian macro trends," Beynon wrote. Macquarie expects Las Vegas Sands' total NR and EBITDA for 2015 to decline by 18 percent and 24 percent, respectively, and then rebound in 2016 following the "Parisian opening and stabilization of VIP/Prem mass rev." The company's high teen ROEs remain its strength, Beynon said.