You Can Still Gamble On Las Vegas Sands

| About: Las Vegas (LVS)

Las Vegas Sands Corp (NYSE: LVS)

We recommended the Las Vegas Sands in April 2011 when it was trading at $44.13. Since then it has traded in a relatively narrow range with the exception of the first quarter of last year when it spiked up to $62.09. Since then the stock has for the most part been trading between $40 and $50 but it broke above that recently, closing Friday at $53.59.

This company is one of the bidders to put a multi-billion dollar casino complex into downtown Toronto, although it hasn't had as high a profile as competitors such as MGM. But Toronto city council has yet to agree to even formally consider proposals and there is a lot of opposition to the idea. So don't hold your breath waiting for this project to come through.

Even if the Toronto opportunity doesn't materialize, the company has great properties not only in Las Vegas but also in Singapore and Macau.

The recent quarterly results showed an adjusted EBITDA of $1.9 billion, which was above street estimates of $1.02 billion. Analysts expect revenues to rise over 18 % to $13.2 billion in 2013, up from $11.1 billion in 2012. Singapore has really begun to produce for the company and friends returning from a recent trip there reported that the hotel was full and the casinos were hopping.

Macau is also doing well and recently reported that revenue grew by 12% in February on a year-over-year basis. The company has begun adding to its properties in Macau and started construction on adjacent parcels, which will include over 6,400 rooms upon completion.

Las Vegas continues to bounce back from the economic downturn. Even though the Nevada gaming commission reported that gambling sales fell 18.7% in January, business in 2012 was generally much better than in 2011 and The Sands will get its share of that improving situation.

All is not rainbows and unicorns though. The company has admitted that it has likely violated an anti-bribery law related to their expansion in Mainland China. While this is unlikely to affect the financial prospects, it will be a bit of an overhang for the stock until it's all sorted out. This uncertainty gives an opportunity for investors to either initiate or add to their holdings.

Action now: Buy with a target of $65.

Disclosure: I am long LVS. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.

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