This fall earnings season within the gaming trade will get underway Wednesday — CDC Gaming

As Las Vegas Sands kicks off gaming’s first high-profile fourth-quarter earnings report Wednesday afternoon, Bank of America has launched its preview for the trade, together with continued softness on the Strip and certain the identical for the primary quarter.

“We are modestly below the Street for Las Vegas, in line for Asia, and see a mixed bag for regionals,” stated BofA analyst Shaun Kelley. “December data came in soft across online, Vegas (revenue per room), and regionals, but we noted in our year ahead that locals and regionals could be One Big Beautiful Bill and fiscal stimulus beneficiaries, respectively.”

Bank of American reported their fourth-quarter estimated earnings are coming in 1% for consensus and a pair of% for MGM Resorts International.

“Gaming revenues were solid, but revenue per available room/visitation remained weak at -6%/-5%, respectively, and we suspect December was light with Strip revenue per room -12% (versus -9% in November),” Kelley stated. “We believe the first quarter could also come in a bit softer, despite the ConAgg convention, before comps ease in the second quarter.”

When it involves casinos that serve native residents, Kelley stated their estimates are 2% greater than consensus, with knowledge suggesting stable native tendencies have continued.

The fourth-quarter regional estimates are 1% above the consensus, pushed by power at MGM and Boyd Gaming, although Kelley stated they anticipate some weak spot for Penn Entertainment on Louisiana competitors. They estimate same-store gaming income was 4% greater year-over-year in October, destructive 1% year-over-year in November, and destructive 3% year-over-year in December.

“Caesars’s fourth-quarter gaming income progress charges are monitoring again nearer to the market after having meaningfully jumped up again in May, which may indicate promotional depth is beginning to stage off,’ Kelley stated.

For on-line gaming, 2026 has picked up proper the place 2025 left off, with on-line sports activities betting dominating their name quantity and conversations, Kelley stated. He stated their bridges are forward of consensus for DraftKings, however under for FanDuel. Hold was higher than anticipated, however weak December and January deal with is reigniting issues.

During the fourth quarter and to date into January, gaming shares are down 9%, with U.S. operators down 4%, Macau operators down 13%, and digital/on-line gaming shares down 23%, Kelley stated.

In Macau, their fourth-quarter estimates for adjusted earnings are in keeping with consensus, Kelley stated. “Revenues were solid (+15% year-over-year and +6% quarter to quarter), and we are +1% above the Street driven by MGM China. Attention will likely be focused on Las Vegas Sands’s market share progress, while investors seem increasingly concerned about tough comps starting in the second quarter.”

Kelley stated their Marina Bay Sands estimate is 2% above the consensus at $705 million and could possibly be helped by F1 shifting from the third quarter to fourth quarter, “with market revenue per room up 27% in October and 13% for all of fourth quarter after being flat most of 2025.”

When it involves Las Vegas Sands, Kelley’s worth goal of $70 is predicated on about 13 occasions their 2026 EBITDAR estimate, a slight low cost to historic common of 13 occasions, given slowing restoration, China macro, and decrease free money movement conversion as a result of concession capex.

Risks to the draw back are a delayed restoration in Macau, continued COVID-related disruption, elevated uncertainty surrounding the implications of the concession course of, the tempo of re-opening in Singapore, and a worse ramp than anticipated for brand new properties.

Risks to the upside are a faster-than-expected return to pre-COVID Macau surroundings, potential border re-openings, better-than-expected returns on latest initiatives, mass market progress in Macau, and potential entry into the sports activities betting and igaming verticals.