Investors should not rely too heavily on weekly Macau GGR data; Bernstein

Sunday 20th of March 2016

Macau’s gross gaming revenue for the week of March 14-20 was MOP 4.1 billion (US$513.4 million), implying an ADR of MOP 585 million vs MOP 674 million in February and MOP 602 million in January, according to a recent report from Bernstein.

Assuming an ADR of MOP 550-600 million for the remainder of the month, March GGR will be MOP 17.8 - 18.3 billion, representing a year on year decline of 15-17 percent.

Bernstein adds that investors should not rely too much on weekly GGR data, given the increase in volatility of the weekly results. “While the weekly numbers may still have some relevance, we highlight our reduced conviction level on the reliability of these figures.”

On the back of mostly in-line Q4 results and strong February GGR, Macau gaming stocks have seen a 40 percent rally since mid-January, says Bernstein. However, Bernstein says investors should not chase the rally, “as stocks may have gotten ahead of themselves and could face a near-term pullback, particularly if March and/or April GGR turns out weaker than expected.”

Some industry insiders are saying casino gross gaming revenue is becoming steadier. Wu Zhiliang president of the Macau Foundation, was quoted by Macau Business saying that he expects this year's gaming revenue to be similar to last year.

Bricks & Mortar ADR Weekly GGR