- Macau posts ninth consecutive month of gross gaming revenue growth
- VIP gamblers are coming back and new casinos are boosting the Chinese territory's outlook
Wynn Resorts stock is up more than 3 percent intraday after Macau's April casino gross gaming revenue rose 16.3 percent, ahead of analysts' consensus for 15 percent growth.
VIP players led the way in the world's largest gambling mecca, with new resort casinos helping to draw in the high rollers.
"The way investors are looking at it, if they want exposure to the recovery, Macau's Wynn is their way of playing that," said Union Gaming analyst John DeCree in Las Vegas. "For Wynn, about 75 to 80 percent of their profits are coming from Macau."
In August, the $4.1 billion Wynn Palace casino resort opened in the Cotai area of Macau. Sands opened its Parisian Macau resort in September.
All three of the U.S.-based casino giants last week reported first-quarter earnings helped by strength from Macau and Las Vegas operations.
April marked the ninth consecutive month of overall growth in Macau gaming revenue and the third month in a row of double-digit percentage growth.
Previously, Macau was reeling due to a Beijing government corruption crackdown on the junket business. The so-called junkets or specialists bring in the high-value Chinese gamblers to the Macau casinos.
"That VIP customer is coming back and Wynn has been capturing a greater share of that customer," the Union Gaming analyst said. "There just has been a resurgence in liquidity, and that's the customer we're seeing."
According to DeCree, Macau should face generally easy comparisons with the year-ago period until the third quarter of 2017. Union Gaming is forecasting May's Macau gaming revenue to increase 15 percent and the second quarter to rise 16 percent.
"The market started to recover last October and November so we have another five months of runway," he said.
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