JPMorgan initiates Las Vegas Sands stock with neutral rating

Investing.com - JPMorgan initiated coverage on Las Vegas Sands (NYSE:LVS) with a neutral rating and set a price target of $47.00 on Monday, representing a 12.8% upside from the current price of $41.68.

The investment bank’s year-end 2026 price target reflects a valuation of 9 times the casino operator’s estimated 2026 enterprise value to EBITDA ratio, representing a significant discount to Las Vegas Sands’ historical average. The company currently trades at an EV/EBITDA multiple of 11x, with impressive gross profit margins of 79%.

JPMorgan noted that while the steep 4x discount to the company’s historical average appears "enticing," it remains cautious due to Las Vegas Sands’ underperformance in the Macau market, which is already facing challenges.

The firm highlighted that gross gaming revenue recovery has stalled in Macau, and there appears to be limited upside potential to the company’s Singapore operations estimates.

JPMorgan indicated it could adopt a more positive stance on Las Vegas Sands if the company recovers market share in Macau or if there is a re-acceleration in industry gross gaming revenue.

In other recent news, Las Vegas Sands Corp. reported its first-quarter 2025 earnings, revealing a slight miss on both earnings per share (EPS) and revenue compared to analyst forecasts. The company posted an EPS of $0.59, narrowly missing the forecast of $0.60, and revenue came in at $2.86 billion, falling short of the anticipated $2.94 billion. Despite the miss, the Marina Bay Sands property in Singapore showcased exceptional performance, with hold-adjusted EBITDA reported at $605 million, surpassing both Mizuho (NYSE:MFG)’s estimate of $495 million and the market expectation of $525.6 million. However, Las Vegas Sands faced challenges in Macau, with hold-adjusted Macau EBITDA at $538 million, missing both Mizuho’s projection of $603 million and the broader market consensus of $609.4 million.

In other developments, Stifel analysts reaffirmed their Buy rating for Las Vegas Sands, maintaining a price target of $57.00, despite reducing it from a previous target of $64.00. They expressed concerns over geopolitical and macroeconomic uncertainties surrounding China and Macau but noted an attractive risk/reward scenario following a recent sell-off. Meanwhile, Mizuho Securities adjusted its financial outlook for the company, reducing the price target to $47.00 from $57.00, while maintaining an Outperform rating. The firm acknowledged the challenges in Macau but emphasized the strong performance in Singapore as a positive indicator.

Las Vegas Sands continues to focus on strategic investments in its Macau and Singapore properties, aiming to enhance future performance despite current market challenges. The company has increased its share repurchase authorization to $2 billion, signaling confidence in its long-term prospects.

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