HOLD IMPACTING MACAU SHARES

August Macau table revs were HK$4.0b through the 8th which projects out to a 40%+ month. Wynn and MPEL continue to move in opposite directions.

 

 

We have preliminary August numbers through the 8th and they look strong, although down sequentially.  Total table revenues were HK$4.0 billion which projects out to about HK$14.7-14.8 billion for the month, after considering that the first 8 days contained 2 Sundays.  While 40%+ YoY growth is nothing to sneer about, sequential growth is slowing, owing primarily to tougher comps.  Table revenues in August of 2009 were up 17% versus +3% in June and -17% in May 2009.

 

Even though the data covers only 8 days, the market share shifts are interesting.  The shifts in table revenue share seen in July seem to have accelerated in August.  Wynn fell to 11.3% thus far in August from 14.6% in July, which was already down significantly from the May peak of 17.2%.  No doubt most of this is hold related.  However, the story of Encore not being additive may begin to gain traction which could be bad for the stock, particularly given the valuation and positive sentiment/momentum already in the stock. 

 

On the other side, MPEL's table share moved up to 18.3% from 14.6% and 13.1% in July and June, respectively.  Unlike WYNN, MPEL shares suffer from poor sentiment - "these guys can't get their act together" - and a low relative valuation.  The perception that persistent bad hold is a permanent phenomenon at CoD/Altira hasn't helped the valuation.  A couple of months of monthly market share gains should.

 

Share trends for LVS, SJM, MGM, and Galaxy remained relatively consistent with July.  Here is the detail:

 

HOLD IMPACTING MACAU SHARES - 111


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