Expectations for Macau unchanged following August revenue report, says Jefferies

Jefferies says that although Macau GGR in August demonstrates strength following seasonal weakness in July, its expectations remain unchanged. The firm continues to be measured on the region as the heavy promotional environment challenges operators and anticipates that valuations remain compressed due to the deteriorating economic weakness in China. Looking ahead, Jefferies remains focused on the October Golden Week holiday, which could potentially provide another catalyst for the market/stocks. The firm’s preferred stocks within its coverage are Galaxy (GXYEF) and MGM (MGM) among U.S.-listed names, in part for Macau execution and easier comps in Las Vegas in 2024. Jefferies believes a catalyst is required for re-rating Las Vegas Sands (LVS) and Wynn Resorts (WYNN), and the current update is generally neutral for stocks.