LVS - Wynn Resorts Las Vegas Sands drop after Jefferies says the casino stocks are less compelling

2023-06-08 07:24:31 ET

Jefferies lowered its rating on Wynn Resorts ( NASDAQ: WYNN ) and Las Vegas Sands ( LVS ) to Hold from Buy on its view that the stocks are being fairly valued at their current share prices.

Analyst David Katz and team believe the bull case arguments for growth in both cases remain and think the recovery in Macau remains early stage. However, those dynamics are seen as relatively well-understood by the market and approximately priced in.

Katz said the Macau recovery should remain productive for both LVS and WYNN, while Las Vegas remains a strong set-up for WYNN and Singapore is a strong driver for LVS.

"The capital set-ups for both names are positive as well, with LVS potentially beginning capital returns and WYNN pivoting to moderate leverage. However, our ultimate point is that we consider the upside less compelling at present levels than at the time of our upgrade."

Jefferies assigned a price target of $65 to LVS (~11% upside potential) and a PT of $114.00 to WYNN (~10% upside potential).

Shares of Wynn Resorts ( WYNN ) fell 1.95% in premarket trading on Thursday, while Las Vegas Sands ( LVS ) shed 1.52% .

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