Several investment analysts are betting on their money that Macau casinos will be able to duplicate a double-digit, gross gaming revenue growth in December.
Last month, Macau posted an estimated MOP 18.79 billion (US$ 2.35 billion) worth of casino gross revenue, a 14.4 percent increase from the previous year.
Analysts from Sanford C. Bernstein, Wells Fargo Securities, Telsey Advisory Group, and Nomura all expressed confidence that Macau market has been improving.
“That might put an end to the series of GGR growth improvements over the past few months, as we saw 1 percent, 7 percent, 9 percent, and 14 percent growth in August, September, October, and November respectively,” Nomura said in a note it issued on Monday. The brokerage firm predicted that Macau’s GGR could increase by up to 13 percent year-on-year in December.
Wells Fargo was also as bullish as Nomura in terms of Macau’s December GGR numbers, with analyst Cameron McKnight saying: “revenues have benefited from above average VIP hold and that sequential strength is coming from both mass and VIP segment.”
McKnight estimated that December Macau gaming revenues will be at +9 percent to +14 percent year-on-year, since their “contacts have been suggesting that some junkets are seeing 15 percent to 20 percent growth in volumes.”
Citing unofficial industry data for the first 11 days of the month, Sanford Bernstein Analysts Vitaly Umansky, Zhen Gong and Yang Xie is optimistic that Macau’s December GGR would be in the range of MOP20.6 billion (US$2.57 billion) to MOP21 billion (US$2.63 billion).
So far, Macau’s casino GGR in the first 11 days of December was about MOP7.55 billion, which, according to the brokerage, implies an average daily rate of [circa] MOP686 million.
“This would represent a year-on-year increase of +12 percent to +14 percent,” they said.
Telsey Advisory Group LLC, meanwhile noted that market indications suggest that “the Macau market has been improving, with particular focus on the sustainability of the recovery in the VIP business.”
Telsey analysts David Katz and Brian Davis pegged Macau’s GGR in December to go up by nearly 10 percent in year-on-year terms, based on data provided by industry sources for the first 11 days of the month.
Of all the analysts, only Buckinham Research Group gave a conservative,
December GGR outlook for Macau casinos. Christopher Jones of the Buckingham Research Group Inc believes Macau GGR will grow between 4 percent and 6 percent year-on-year in December.
“We are maintaining our fourth quarter GGR outlook, which assumes a 9 percent increase for the quarter, with expectations for mass market GGR to increase in the 11 percent to 12 per
