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<Research>M Stanley Expects Slight Margin Compression in Casinos in 4Q25, Prefers GALAXY ENT/ SANDS CHINA LTD
Recommend 27 Positive 37 Negative 19 |
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The industry segmentation data from the Macau Gaming Inspection and Coordination Bureau (DICJ) has led to a further downward revision of its 4Q25 forecast for Macau's gaming industry, according to Morgan Stanley's research report. Due to an unfavorable business mix shift (high VIP) and increased operating expenses, the 4Q25 profit margin is expected to slightly decrease, Morgan Stanley noted. It is anticipated that the industry average adjusted property EBITDA for 4Q25 will grow by 4% QoQ and 13% YoY, in line with market consensus. For individual stocks, the broker was bullish on GALAXY ENT (00027.HK) and SANDS CHINA LTD (01928.HK), with both rated at Overweight. In December 2025, Morgan Stanley downgraded MGM CHINA (02282.HK) to Equalweight due to higher royalty fees, and rated SJM HOLDINGS (00880.HK) at Underweight. MGM CHINA significantly underperformed the market in December, but given its improved market share in 4Q25, some recovery might be observed, the broker added. AASTOCKS Financial News Website: www.aastocks.com |
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