Sands China (SCHYY) AI Stock Analysis

• Market Cap: $21.93B
• Dividend Yield: 2.21%
• Average Volume (3M): 4.92K
• Price to Earnings (P/E): 23.9
• Beta (1Y): 0.54
• Revenue Growth: -2.90%
• EPS Growth: -13.46%
• Country: US
• Employees: 27,064
• Sector: Consumer Cyclical
• Sector Strength: 81
• Industry: Gambling, Resorts & Casinos
• EPS (TTM): 0.51
• Shares Outstanding: 809,337,950
• 10 Day Avg. Volume: 1,973
• 30 Day Avg. Volume: 4,922
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.05
• Enterprise Value/Revenue: 3.24
• Enterprise Value/Gross Profit: 5.49
• Enterprise Value/Ebitda: 10.69
• 1Y Price Target: $25.00
• Price Target Upside: -7.72% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 0

• Rating: 68 Neutral
• Price Target: $25.00 ▼(-7.72% Downside)

Sands China is on a promising recovery trajectory with strong financial performance, though high leverage is a risk. Technical indicators show bullish momentum but suggest caution due to overbought signals. Valuation is fair, offering moderate returns.

Positive Factors

Revenue Growth

A 71.76% increase in revenue indicates strong market demand and effective business strategies, supporting long-term growth prospects.

Profit Margins

Improved profit margins reflect enhanced operational efficiency and cost management, contributing to sustainable profitability.

Cash Flow Strength

Robust operating cash flow supports liquidity and financial flexibility, enabling strategic investments and debt management.

Negative Factors

High Financial Leverage

Significant leverage poses risks to financial stability, potentially impacting the company's ability to weather economic downturns.

Equity Ratio Concerns

A low equity ratio indicates vulnerability to financial stress, limiting the company's capacity to absorb losses and invest in growth.

Decreased Free Cash Flow

A decline in free cash flow may constrain the company's ability to fund new projects and reduce debt, affecting future growth potential.

Sands China Business Overview & Revenue Model

Company Description

Sands China Ltd., an investment holding company, develops, owns, and operates integrated resorts and casinos in Macao. It owns and operates The Venetian Macao, The Londoner Macao, The Parisian Macao resort, The Plaza Macao, and The Sands Macao casino; the Cotai Expo, a convention and exhibition hall; and the Cotai Arena, an entertainment venue, as well as Cotai Water Jet ferry for leisure and business travelers. As of December 31, 2021, the company had 12,373 hotel rooms and suites, 151 restaurants and food outlets, 2.1 million square feet of retail malls, 1.7 million square feet of MICE space, 4 permanent theatres, a 15,000-seat arena, and casinos. It also offers ferry transportation and leasing services, and pontoon leasing; travel and tourism agency services; security services; human resources administration services; and mall management services, as well as outsourcing services, including information technology, accounting, hotel management, and marketing. The company was incorporated in 2009 and is headquartered in Taipa, Macau. Sands China Ltd. is a subsidiary of Las Vegas Sands Corp.

How the Company Makes Money

Sands China generates revenue primarily through its gaming operations, which include table games and slot machines, making up the bulk of its earnings. The company also benefits from its non-gaming revenue streams, which include hotel accommodations, food and beverage sales, retail shopping, and entertainment experiences. Additionally, Sands China's integrated resort model allows for cross-promotion of its various offerings, enhancing guest experiences and encouraging longer stays. Significant partnerships with global brands and entertainment providers further bolster its revenue potential. Market conditions in Macao, such as tourism trends and regulatory changes, also play a crucial role in shaping the company's financial performance.

Sands China Financial Statement Overview

Summary

Sands China demonstrates a strong recovery with significant revenue growth, improved profit margins, and robust cash flow metrics. However, high financial leverage remains a risk, necessitating careful management to maintain financial stability.

Income Statement

Sands China shows strong recovery in its income statement, with significant revenue growth from $4.12 billion in 2023 to $7.08 billion in 2024, indicating a 71.76% increase. Gross profit margin improved to 59.0% from 50.6% in 2023. Net profit margin also increased to 14.76% in 2024, compared to 16.78% in 2019, before the pandemic impacts. EBIT and EBITDA margins are strong at 19.29% and 30.31% respectively, showcasing improved operational efficiency and profitability. These metrics reflect a robust recovery trajectory.

Balance Sheet

The balance sheet reveals a high debt-to-equity ratio of 7.91 in 2024, indicating significant leverage. However, the company's equity has turned positive to $1.03 billion from a negative position in 2023. Return on Equity (ROE) is high at 101.46%, indicating efficient use of equity, but this is due to the small equity base. The equity ratio remains low at 9.23%, signaling potential risks from financial leverage. Despite the high leverage, the positive equity turnaround suggests improving financial health.

Cash Flow

Operating cash flow remains strong at $2.07 billion in 2024, with a healthy operating cash flow to net income ratio of 1.98. Free cash flow is positive at $1.21 billion, although it saw a decrease from $2.08 billion in 2023, reflecting increased capital expenditures. The free cash flow to net income ratio stands at 1.16, indicating solid cash generation relative to earnings. Overall, cash flow metrics suggest robust liquidity and operating efficiency, despite fluctuations in free cash flow growth.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	7.08B	6.53B	1.60B	2.87B	1.69B
Gross Profit	4.18B	5.24B	487.00M	1.73B	549.00M
EBITDA	2.15B	2.02B	-427.00M	25.00M	-557.00M
Net Income	1.04B	692.00M	-1.58B	-1.05B	-1.52B
Balance Sheet
Total Assets	11.17B	10.26B	10.56B	10.09B	10.55B
Cash, Cash Equivalents and Short-Term Investments	1.97B	1.36B	790.00M	678.00M	861.00M
Total Debt	8.16B	8.33B	10.20B	7.95B	7.04B
Total Liabilities	10.14B	10.26B	11.26B	9.21B	8.62B
Stockholders Equity	1.03B	-4.00M	-700.00M	888.00M	1.93B
Cash Flow
Free Cash Flow	1.21B	2.09B	-676.00M	-476.00M	-1.83B
Operating Cash Flow	2.07B	2.29B	-473.00M	88.00M	-816.00M
Investing Cash Flow	-810.00M	-180.00M	-325.00M	-634.00M	-1.02B
Financing Cash Flow	-658.00M	-2.45B	1.82B	366.00M	231.00M

Sands China Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 27.09
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SCHYY, the sentiment is Positive. The current price of 27.09 is above the 20-day moving average (MA) of 25.89, above the 50-day MA of 24.82, and above the 200-day MA of 22.33, indicating a bullish trend. The MACD of 0.50 indicates Negative momentum. The RSI at 64.83 is Neutral, neither overbought nor oversold. The STOCH value of 100.02 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SCHYY.

Sands China Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
RRR	72 Outperform	$6.51B	23.48	97.52%	3.26%	7.47%	2.58%
SCHYY	68 Neutral	$21.93B	23.94	111.19%	2.21%	-2.90%	-13.46%
WYNN	68 Neutral	$12.88B	36.26	-51.73%	0.82%	-1.94%	-53.90%
MGM	62 Neutral	$9.62B	19.04	17.34%	―	0.89%	-31.56%
Sector *	61 Neutral	$18.16B	12.70	-2.51%	3.03%	1.44%	-15.67%
LVS	59 Neutral	$36.73B	27.01	49.16%	1.78%	1.62%	-7.14%
MLCO	58 Neutral	$3.89B	73.07	25.40%	―	12.51%	―