{"id":27977,"date":"2020-09-15T07:26:12","date_gmt":"2020-09-15T15:26:12","guid":{"rendered":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/?p=27977"},"modified":"2020-09-17T07:12:00","modified_gmt":"2020-09-17T15:12:00","slug":"sands-low-on-vegas-boyd-upbeat-mixed-signals-from-station","status":"publish","type":"post","link":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/sands-low-on-vegas-boyd-upbeat-mixed-signals-from-station\/","title":{"rendered":"Sands low on Vegas, Boyd upbeat, mixed signals from Station"},"content":{"rendered":"\n
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Yesterday it was Las Vegas Sands<\/strong>‘ turn with JP Morgan<\/strong> gaming analysts and the company was full of surprises. Little of its commentary had to do with the Las Vegas Strip<\/strong>, about which it was “downbeat,” what with conventioneers and high rollers being in short supply. “LVS hasn\u2019t pursued the relatively less profitable drive-in customer, and doesn\u2019t look to pivot from its group\/convention focus as management still expects a full recovery here,” wrote analyst Joseph Greff<\/strong>, adding that layoffs had nonetheless been “limited.” Off the burner entirely is Sands’ planned U.S. shopping spree for casinos. This was “made under the presumption that assets would be deeply mispriced during the crisis, but at this point, they look to have largely recovered.” (Good news if you are a holder of said assets.) Instead Sands will look to pick up additional properties “where it already has a presence,” i.e., Asia<\/strong>.<\/p>\n\n\n\n

The company’s focus was mainly on Macao<\/strong> and Singapore<\/strong>. In the latter, it expects recovery to be “gradual” rather than dramatic “as China<\/strong> will be prudent in allowing the number of visas to increase gradually over time.” As with MGM Resorts International<\/strong>, customer interest is said to be strong, especially in premium mass-market play, although Sands hopes its bread-and-butter players return in time for the rollout of the Londoner<\/strong> and Four Seasons Tower Suites<\/strong>. The company actually expects better<\/em> cash flow in Macao this year than last. Locals and their slot play are keeping Marina Bay Sands<\/strong> “on the road to profitability,” despite zippo overseas patronage. But it won’t be business as usual until Malaysia<\/strong> and Japan<\/strong> reopen themselves to Singaporean traffic.<\/p>\n\n\n\n\n\n\n\n

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Boyd Gaming<\/strong> CEO Keith Smith<\/strong> reported results that were ‘amazing’ … as in “amazingly stable,” which is saying a lot these days. The big exception is Downtown<\/strong>, where half the Las Vegas visitors go\u2014or would in normal times. Thanks, we presume, to stringent Hawaiian quarantine policies, that all-important sector has lagged. (No word on the fate of Main Street Station<\/strong>.) This must be one of those moments in which Smith is glad to be shot of Echelon<\/strong>: Greff reported, “Management is not overly concerned about prospects for a slow LV strip recovery as it sees lower\/limited correlation with the LV Locals market (higher retiree mix, more diversified LV Locals economy vs. prior downturns).” Look for a leaner Boyd going forward, as it is seeing improved margins thanks to Covid-19<\/strong> operating efficiencies\u2014less labor, less marketing, fewer amenities. Boyd “expects these margin improvement initiatives will be permanent as the marketing environment remains rational and BYD only rehires labor as demand dictates.” And even if amenities are brought back, Boyd plans to do more with less workforce.<\/p>\n\n\n\n

Smith seems happy with his company’s relationship with FanDuel<\/strong>, from which it gets a slice of the sports-betting market in return for a 5% stake in the wagering provider, majority owned by Flutter Entertainment<\/strong>. Besides, Boyd is gaining access to some MGM markets (and vice versa) from a “reciprocal skin arrangement.” Stay tuned for a stand-alone product for Internet gambling, one from which the company hopes to reap new retail customers. Unlike Sands, Boyd is keeping an eye on the domestic markets in which “a number of gaming assets are currently being shopped,” even though it’s holding out for deals that would be “strategic and accretive.” Boyd isn’t the only company playing the long game …<\/p>\n\n\n\n

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Over at Station Casinos<\/strong>, they’re seeing a new breed of customer\u2014”new faces, younger … Most of the customers that have yet to return are 55+ and\/or have a higher COVID risk.” Not one to miss a trick, Station is trying to convert its new Young Turks into loyalty players. Revenue is much the same as in summer, visitation is lower than usual but spend-per-customer is higher. On the plus side, as it were, summer is a traditionally slow period for locals play and, Greff writes, “3Q trends this year have been better than usual given locals\u2019 reluctance to travel and stable levels of drive-in traffic from Southern California<\/strong>.” The economy looks “choppy” but homeowners seeking relief from SoCal real estate prices in the Las Vegas Valley<\/strong> could bolster the future, as could higher-tier earners who will be working from their new Clark County<\/strong> homes. As for promotions, don’t get your hopes up: Station is keeping its powder dry on marketing spending. Good news, the company is rehiring. Bad news, cutbacks in full-time equivalents are counterbalancing the move.<\/p>\n\n\n\n

As for the big question on everybody’s mind\u2014the fate of the Palms Casino<\/strong>, Fiesta Henderson<\/strong>, Texas Station<\/strong> and Fiesta Rancho<\/strong>\u2014Station will be monitoring A) the recovery of the Las Vegas Strip<\/strong>, crucial to the Palms, B) business levels at its other casinos and C) “if the incremental revenue from recovering those ‘lost’ customers will allow the property to open profitably.” That’s a shade more hopeful than CEO Frank Fertitta III<\/strong>‘s apocalyptic musing about never reopening them. However, Priority One is to use cash flow to retire debt, not prop up struggling casinos, and maintain “a healthy and flexible balance sheet.” Durango Station<\/strong> is back “on” again, for the umpteenth time since the turn of the century, and other projects are under discussion. As for existing casinos, they’ll have to divvy up $65 million-$75 million in annual capex maintenance. It doesn’t sound like Station is going to be hurried into anything.<\/p>\n","protected":false},"excerpt":{"rendered":"

Yesterday it was Las Vegas Sands‘ turn with JP Morgan gaming analysts and the company was full of surprises. Little of its commentary had to do with the Las Vegas Strip, about which it was “downbeat,” what with conventioneers and … Continue reading →<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[60,275,51,14,278,144,283,22,62,53,245,159,254,108,243,57,38],"tags":[],"_links":{"self":[{"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/posts\/27977"}],"collection":[{"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/comments?post=27977"}],"version-history":[{"count":1,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/posts\/27977\/revisions"}],"predecessor-version":[{"id":27978,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/posts\/27977\/revisions\/27978"}],"wp:attachment":[{"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/media?parent=27977"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/categories?post=27977"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/tags?post=27977"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}