UH-OH: Is The Great Macau Story Over?

Venetian Macau

Las Vegas Sands shares are tanking today after the company reported disappointing revenues for Q4 overnight.

EPS came in strong, beating the street estimate with an EPS of $0.42. But revenues were below expectations, coming in at $2.02 billion rather than the $2.07 billion expected.

Revenues for China Sands, its Macau subsidiary, increased 13.1% year-over-year. EBITDA for Las Vegas Sand’s casinos in Macau increased 35.7% in Q4 to $341.2 million, according to the earnings release.

So why the big disappointment? Investors were expecting a blowout quarter from Macau, and it didn’t deliver.

Q4 revenues at the Four Seasons Macau and Plaza Casino declined 6.1% year-over-year, which may be a source of concern.

As a result of these disappointing revenue numbers, the stock has tanked today and is down over 6%.

But does that make sense in the long-run?

From J.P. Morgan analyst Joseph Greff (via The Street):

We think last night’s 6% decline in aftermarket is a near-term buying opportunity in front of a 2011 Singapore ramp in all segments, 2011 Macau market strength and a catalyst in Chinese New Year,

Still, there may be some doubt creeping in to the Macau story.

Check out the 6 gambling giants that have created a mega hub in Macau >

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