Takeaway: We are adding LVS to the long side today.

Editor's Note: Please note that Gaming, Lodging & Leisure analyst Todd Jordan will send out a full report outlining our high-conviction long thesis. In the meantime, below is a brief summary written by Hedgeye CEO Keith McCullough earlier this afternoon.

LVS: Adding Las Vegas Sands to Investing Ideas (LONG SIDE) - lvs

With the SP500 sucking back to the low-end of my immediate-term risk range, I'm back in buy/cover mode where single securities are signaling immediate-term TRADE oversold.

One of those is Las Vegas Sands (LVS) which is -1.3% on the day after correcting within our Ace, Todd Jordan's, bullish intermediate-term TREND view. Per TJ in one of his recent Institutional Research notes:

"At the end of the day, we’re talking about a company that generates less than 9% of its Macau EBITDA from VIP (and even less from junkets), so if mass growth is turning positive this is a huge inflection point. We agree with management (we don’t always) that there is little reason to believe that mass growth will be negative again (The Last Time?). The implications of positive mass growth have a long tail. Mass growth prior to the opening of Wynn Palace and LVS’s own The Parisian Macao suggests that supply absorption may be quicker than anticipated. Moreover, as the largest mass player, LVS Street Macau estimates now look achievable and, dare we say, beatable.  Finally, if estimates look reasonable then so does LVS’s hefty 6% dividend yield. At this point, it doesn’t appear that the company will have to raise its already low relative leverage to pay the dividend. So now it’s finally safe to say that the big dividend yield is real, sustainable and growing. A MLP, LVS is not…"

Buy Red,

KM