{"id":219442,"date":"2022-06-30T14:22:05","date_gmt":"2022-06-30T19:22:05","guid":{"rendered":"https:\/\/www.casino.org\/news\/?p=219442"},"modified":"2022-06-30T15:00:04","modified_gmt":"2022-06-30T20:00:04","slug":"sands-credit-outlook-facing-challenges-says-moodys","status":"publish","type":"post","link":"https:\/\/www.casino.org\/news\/sands-credit-outlook-facing-challenges-says-moodys\/","title":{"rendered":"Sands Rebound Needs Two More Years, Says Moody\u2019s"},"content":{"rendered":"

Wary Las Vegas Sands (NYSE:LVS) investors waiting on the casino operator to regain its lost form may be waiting another two years.<\/p>\n

\"Sands
The Venetian Macau. Moody’s sees challenges for Sands’ credit profile. (Image: Bobby Yip\/Reuters<\/em>)<\/figcaption><\/figure>\n
\n

That according to Moody\u2019s Investors Service, which says a full rebound for the Macau giant may not materialize until 2024. Moody\u2019s rates Sands \u201cBaa3,\u201d which is non-investment grade with a \u201cnegative\u201d outlook. That grade implies moderate credit risk. Ratings agencies are souring on gaming companies with Macau exposure.<\/p>\n<\/div>\n

Earlier this month, Fitch Ratings stripped Sands of an investment grade, citing weakness in Macau. In April, Moody\u2019s Investors Service<\/a> pared MGM Resorts International\u2019s (NYSE:MGM) credit rating to \u201cB1\u201d from \u201cBa3,\u201d moving the casino operator\u2019s grade one notch further into non-investment grade territory.<\/p>\n

Sands operates six integrated resorts, five of which are in Macau. As a result, the company is heavily dependent on China for revenue. Morgan Stanley notes the casino operator derives 62%<\/a> of its sales from China — a total surpassed by just four US-based non-semiconductor companies.<\/p>\n

Sands Recovery Trying Investors\u2019 Patience<\/h2>\n

Since the outbreak of the coronavirus in early 2020, Macau operators, including Sands China, have continually frustrated investors. China has implemented a variety of restrictive quarantine, travel, and visa policies that made visits to the casino hub unattractive for many prospective gamblers. Some of those requirements, though in varying forms, remain in place today. Still, Moody\u2019s sees some runway for things to perk up for Sands later this year.<\/p>\n

We expect the ramp up will improve over the back half of 2022, although expect mass-market gaming revenue to still remain roughly 40 percent of 2019 levels by the end of 2022, increasing to 80 percent in 2023,\u201d<\/strong> notes the research firm.<\/p><\/blockquote>\n

On the other hand, with the stock down 10.71% year-to-date, and near-term restoration of its dividend<\/a> unlikely, LVS could use a speedier rebound to foster confidence among investors. But that may not materialize.<\/p>\n

\u201cA more full recovery in gross gaming revenue is unlikely until 2024 and is dependent on a resumption of business travel and continued ramp up in leisure travel,\u201d adds Moody\u2019s.<\/p>\n

At Least Sands Has Cash<\/h2>\n

This year, analysts are voicing concern about Macau concessionaires cash burn rates and whether or not the companies can survive in a lengthy environment of sluggish revenue accumulation. For its part, Sands has $6.4 billion in cash on hand and another $3.5 billion on an undrawn credit revolver.<\/p>\n

Sands\u2019 credit outlook is \u201csupported by the high quality, popularity, and favorable reputation of its casino properties, along with the company\u2019s very strong credit metrics leading up to the coronavirus and positive long-term gaming demand trends in each of its geographic markets,\u201d according to Moody\u2019s.<\/p>\n

Conversely, the research firm sees Sands\u2019 credit profile remaining troubled through the remainder of this year, and challenges through 2023 in terms of bolstering that credit outlook. That thesis is based on earnings headwinds and potentially high rates of cash burn.<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

Wary Las Vegas Sands (NYSE:LVS) investors waiting on the casino operator to regain its lost form may be waiting another two years. That according to Moody\u2019s Investors Service, which says a full rebound for the Macau giant may not materialize until 2024. Moody\u2019s rates Sands \u201cBaa3,\u201d which is non-investment grade with a \u201cnegative\u201d outlook. That […]<\/p>\n","protected":false},"author":46,"featured_media":219443,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[69069,10],"tags":[],"acf":[],"yoast_head":"\nSands Credit Outlook Facing Challenges, Says Moody's<\/title>\n<meta name=\"description\" content=\"With full recovery unlikely before 2024, Sands faces credit headwinds, notes Moody's.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.casino.org\/news\/sands-credit-outlook-facing-challenges-says-moodys\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Sands Credit Outlook Facing Challenges, Says Moody's\" \/>\n<meta property=\"og:description\" content=\"With full recovery unlikely before 2024, Sands faces credit headwinds, notes Moody's.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.casino.org\/news\/sands-credit-outlook-facing-challenges-says-moodys\/\" \/>\n<meta property=\"og:site_name\" content=\"Casino.org\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/Casino.OrgNews\" \/>\n<meta property=\"article:published_time\" content=\"2022-06-30T19:22:05+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2022-06-30T20:00:04+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/06\/VM-1-scaled.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"2560\" \/>\n\t<meta property=\"og:image:height\" content=\"1706\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Todd Shriber\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@etfgodfather\" \/>\n<meta name=\"twitter:site\" content=\"@Casino_Org\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Todd Shriber\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"2 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.casino.org\/news\/sands-credit-outlook-facing-challenges-says-moodys\/\",\"url\":\"https:\/\/www.casino.org\/news\/sands-credit-outlook-facing-challenges-says-moodys\/\",\"name\":\"Sands Credit Outlook Facing Challenges, Says Moody's\",\"isPartOf\":{\"@id\":\"https:\/\/www.casino.org\/news\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/www.casino.org\/news\/sands-credit-outlook-facing-challenges-says-moodys\/#primaryimage\"},\"image\":{\"@id\":\"https:\/\/www.casino.org\/news\/sands-credit-outlook-facing-challenges-says-moodys\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/06\/VM-1-scaled.jpg\",\"datePublished\":\"2022-06-30T19:22:05+00:00\",\"dateModified\":\"2022-06-30T20:00:04+00:00\",\"author\":{\"@id\":\"https:\/\/www.casino.org\/news\/#\/schema\/person\/f4cecf70a5032bc4e60eb73fc86d4a85\"},\"description\":\"With full recovery unlikely before 2024, Sands faces credit headwinds, notes Moody's.\",\"breadcrumb\":{\"@id\":\"https:\/\/www.casino.org\/news\/sands-credit-outlook-facing-challenges-says-moodys\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/www.casino.org\/news\/sands-credit-outlook-facing-challenges-says-moodys\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/www.casino.org\/news\/sands-credit-outlook-facing-challenges-says-moodys\/#primaryimage\",\"url\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/06\/VM-1-scaled.jpg\",\"contentUrl\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/06\/VM-1-scaled.jpg\",\"width\":2560,\"height\":1706,\"caption\":\"The Venetian Macau. 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