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<Research>HSBC Research Expects Satellite Casino Absorption Costs to Be Manageable, Rates MGM CHINA/ GALAXY ENT at Buy
Recommend 17 Positive 37 Negative 15 |
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SJM HOLDINGS (00880.HK) will close nine satellite casinos by the end of the year, and acquire 2 of them; while Melco Resorts & Entertainment (MLCO.US) and GALAXY ENT (00027.HK) will each close one satellite casino, according to a research report issued by HSBC Global Research. Companies need to internally absorb affected employees and equipment. Among the 5,600 affected employees, 4,800 are employed by gaming concessionaires, the broker added. Therefore, the additional cost to absorb the remaining 800 employees is manageable. Regarding stocks, HSBC Global Research was optimistic about MGM CHINA (02282.HK) due to its strong return on capital and a 5.6% dividend yield. The broker believed that the group's strong execution capabilities and efficient operations can deliver resilient results in a challenging environment. Therefore, HSBC Global Research rated MGM CHINA at Buy, with a target price of $14.5. Furthermore, HSBC Global Research also liked GALAXY ENT due to its continued growth of its Phase 3 project and as the opening of its Capella Hotel in mid-2025 can support market share gains. The broker rated the stock at Buy, with a target price of $41.5. AASTOCKS Financial News Website: www.aastocks.com |
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