• It's Coming...


    Identify global risks and opportunities with essential macro intel using Hedgeye’s Market Edges.

Even after adjusting for low Baccarat hold, May Strip numbers were ugly.  This comes on the day I received an offer from Excalibur for a $24 hotel room.

Nevada just announced gaming revenues for May.  While the Locals market grew, Strip GGR fell a whopping 18% YoY.  The bulls will no doubt point to low Baccarat hold of roughly 8% versus normal of around 12%, but slot hold was very high: 8.0% versus normal of 7.3%.  Normalizing hold yields negative GGR growth of -11%.  This is even worse than the mid-single digit drop we were expecting and below investor expectations of a slight increase.  MGM's numbers look like they will need to come down and we were already below the Street.

  • Slot handle fell 7% off of a relatively easy comp
  • Slot win lost 3% despite higher than normal hold
  • June hold may be below normal due to end of month on Saturday
  • Bacc win fell 47%, on hold of 8.2% (TTM: 12.5%); baccarat volume fell 22%
  • Table win ex bacc fell 18% on below average hold of 10.3%;
  • Table volume ex bacc grew 2%
  • Hold-adjusted total win was -11%

There is a bit of a divergence here with the Las Vegas Locals market which actually increased 7%.  Probably a positive for BYD.