Why Is Melco Resorts Stock Up 12% Today?

Melco Resorts & Entertainment Ltd MLCO  shares are trading higher Monday after Macau  officials signaled that COVID-19 travel restrictions will be lifted.

Macau's chief executive Ho Iat Seng has said China would resume an e-visa scheme for mainland travelers and permit group tours, per Reuters. 

The report suggests that for the first time in nearly three years, mainland tour groups will resume in China's special administrative region in November. Currently, Chinese tourists to Macau are required to book a visa appointment, which is followed by an approval process that can take a week. 

E-visas were popular among Chinese gamblers prior to the pandemic. The individual visas reportedly accounted for around 50% of Chinese visitors to Macau in 2019. Tour groups accounted for approximately 25%.

Citigroup analyst George Choi also maintained Melco with a Buy rating and raised the price target from $11 to $11.50.

Melco is one of only six licensed casino operators in Macao, the only region in China with legalized gambling.

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MLCO Price Action: Melco has a 52-week high of $11.81 and a 52-week low of $4.06.

The stock was up 12.4% at $5.96 at time of publication, according to Benzinga Pro.

Photo: courtesy of Melco Resorts.