{"id":1328,"date":"2018-02-20T08:32:07","date_gmt":"2018-02-20T15:32:07","guid":{"rendered":"https:\/\/tradersnation.com\/?p=1328"},"modified":"2018-02-20T08:39:09","modified_gmt":"2018-02-20T15:39:09","slug":"time-to-go-all-in-morgan-stanley-sees-some-casino-stocks-doubling-by-2022","status":"publish","type":"post","link":"https:\/\/tradersnation.com\/index.php\/2018\/02\/20\/time-to-go-all-in-morgan-stanley-sees-some-casino-stocks-doubling-by-2022\/","title":{"rendered":"Time to go all in? Morgan Stanley sees some casino stocks doubling by 2022"},"content":{"rendered":"

By Ryan Vlastelica<\/strong> | Markets reporter<\/p>\n

If the house always wins, try investing in the house directly.<\/p>\n

Gaming companies have been big gainers throughout 2017, sharply outperforming the broader market in a trend that analysts speculate will only accelerate from current levels, with particular growth coming from the overseas casino hot spot Macau.<\/p>\n

Among the sector\u2019s notable gainers, Las Vegas Sands Corp. LVS, -0.63%<\/span><\/a><\/span> \u00a0is up 26% thus far this year, while Gaming & Leisure Properties Inc. GLPI, -0.46%<\/span><\/a><\/span> \u00a0has risen 21%. Other stocks have seen even more pronounced moves: Melco Resorts & Entertainment Ltd. MLCO, -1.14%<\/span><\/a><\/span> \u00a0has surged nearly 60% in 2017 while investors in Wynn Resorts Ltd. WYNN, +0.30%<\/span><\/a><\/span> \u00a0have really hit the jackpot. The stock has climbed 75%. (Not every name has been a winner: MGM Resorts International MGM, -1.31%<\/span><\/a><\/span> \u00a0is up a much-smaller 9% on the year, with recent weakness following <\/a>the mass shooting in Las Vegas.)<\/p>\n

The VanEck Vectors Gaming ETF BJK, +0.15%<\/span><\/a><\/span> the only exchange-traded fund to track the sector of gaming-related stocks,\u00a0is up about 29% thus far this year, well above the 15.6% rise of the S&P 500 SPX, -0.19%<\/span><\/a><\/span><\/p>\n

According to FactSet data, the average component in the $23.7 million fund has annual sales growth of 7.58% and a dividend yield of 2.52%. The average price-to-earnings ratio, one popular gauge of valuation, is 32.46 times. S&P 500 components have a nearly identical P\/E ratio (32.64), but sales growth of 7.2% and an average dividend yield of 1.91%.<\/p>\n

The ETF has heavy exposure to Macau. About 26.4% of its revenue is tied to the region, according to FactSet, up 2.3% from the previous year. The U.S. is in second place, accounting for 24.4% of revenue.<\/p>\n

Macau could be a driving force going forward, according to Morgan Stanley, which predicted that the Macau gaming sector could double in size by 2022.<\/p>\n

\u201cWe believe we\u2019ve started a new upcycle and expect revenue to compound 10% through \u201822 driven by infrastructure and rising spending growth,\u201d the investment bank wrote in a note to clients. \u201cThis should generate investor returns of a 20% compound annual growth rate, supported by our confidence in a smooth license renewal & a surge in capital returns as capital expenditures peaked in 2017.\u201d<\/p>\n

\n
\n

Chart courtesy Morgan Stanley<\/cite><\/p>\n

Morgan Stanley on Tuesday upgraded the Hong Kong and Macau gaming sector to attractive, compared with the \u201cin line\u201d view it has on North American gaming and lodging companies.<\/p>\n<\/div>\n<\/figure>\n

\n

Orginal story<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

By Ryan Vlastelica | Markets reporter If the house always wins, try investing in the house directly. Gaming companies have been big gainers throughout 2017, sharply outperforming the broader market in a trend that analysts speculate will only accelerate from current levels, with particular growth coming from the overseas casino hot spot Macau. Among the […]<\/p>\n","protected":false},"author":6,"featured_media":1330,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[95],"tags":[196,195,194],"class_list":["post-1328","post","type-post","status-publish","format-standard","has-post-thumbnail","category-markets","tag-casino-stocks","tag-gambling","tag-vegas"],"aioseo_notices":[],"aioseo_head":"\n\t\t\n\t\n\t\n\t\n\t\n\t\n\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t