MGM Resorts, Las Vegas Sands and Wynn Resorts have received a kick up the backside with Moody’s Investors Service upgrading both companies. The ratings firm lifted the “corporate family rating” to Ba2 for Wynn, only two levels below investment grade. Rather unsurprisingly Macau is cited as the main reason behind the rise with it accounting for 70% of Wynn’s consolidated revenue.
“Given Moody’s favorable view of Wynn’s future performance in Macau, the company should have the free cash flow and financial capacity to simultaneously invest in future large, high growth global development opportunities and continue to reward equity shareholders in a manner that preserves much of the credit quality improvements it achieved over the past year,” Moody’s Senior Vice President Keith Foley said.
MGM’s rating moved to B2, five levels below investment level, with the improving Vegas environment and a joint venture in Macau to thank. It expects the company’s result to continue being driven by credit for high-rollers and comes after Standard & Poor had raised its junk level rating for the firm.
LVS saw its rating raised later in the day as the ratings firm also pointed to growth in the same region while expecting them to have “free cash flow and financial capacity to invest in future large development opportunities.” They also alluded to the company reinvigorating relationships with the important Chinese VIP junket operators.
Galaxy Entertainment Group has chosen to puff out its own chest by biggin’ up their own chances next year. The Macau casino business company is expecting to do better than an industry consensus of 15 to 20% growth in 2012. Macau Business reports that chief financial officer Robert Drake told a Reuters China Investment Summit: “Everyone is looking at the VIP market in particular. We haven’t seen any signs of slowing. There is plenty of liquidity in the market and visitation remains strong.”
Macau’s newest casino business was built by Galaxy and opened earlier this year to give them more of a share of the world’s largest casino market.
