Financial News
Written by: Huang Youhua
2020-11-27 21:10
Last update date: 2020-11-27 21:10
The new crown pneumonia ravaged the world, many countries or regions announced customs closures, and industries related to tourism and leisure and entertainment were immediately in trouble. Macau, which is separated by the sea, was severely affected.
Since February this year, gambling revenue has recorded a year-on-year decline of more than 70% for nine consecutive months, of which the decline in April and June reached 97%.
With positive news about the progress of vaccine development and mainland residents being able to travel to Macau again on their own, a number of Hong Kong-listed casino gambling stocks have rebounded. Among them, MGM China (2282) has risen over the past month. 17%.
However, the global epidemic has deteriorated recently, and the upward momentum of gambling stocks has been significantly reduced.
Has this wave of gambling stocks come to an end?
Coupled with the approaching year end, many fund managers may be less active than before.
If an investor who had successfully caught a ride earlier, would he get off the car first to hold the profit, or would he sit for a while?
It is better to listen to the words of the two experts first to develop the most suitable strategy.
The full resumption of free travel between the Mainland and Macau and the good news about the progress of vaccine development have become the driving force for the rise of casino stocks.
In the past month, Wynn Macau (1128), Sands (1928), Melco International (0200), MGM and GEG (0027) have all increased by more than 10%. Among them, MGM has the most outstanding performance.
In contrast, SJM Holdings (0880) performed slightly behind.
Another reason that triggered the rise of gambling stocks was related to the monthly rebound of gambling revenue in October.
According to data from the Macau Gaming Inspection and Coordination Bureau, gross gaming revenue in October recorded 7.27 billion patacas, a sharp increase of 2.29 times on a monthly basis, not only in line with market expectations of 7 to 8 billion yuan, but also the best since January this year. The year-on-year decline also narrowed to 72.5%.
After entering November, the local gambling revenue still recorded a year-on-year decline, but the decline was similar to that in October.
According to the latest report issued by HSBC Research, gambling revenue on the first 22nd of this month was 4.75 billion patacas, a 71% year-on-year decrease.
The bank assumes that if the average daily gambling revenue for the remainder of the month ranges from 1.9 to 2.4 patacas, the monthly gambling revenue ranges from 62.5 to 6.65 billion patacas, down 71 to 73% year-on-year.
According to data from the Macau Gaming Inspection and Coordination Bureau, gross gaming revenue recorded 7.27 billion patacas in October, a sharp increase of 2.29 times on a monthly basis.
(Screenshot of Macau Gaming Inspection and Coordination Bureau)
Driven by the above three factors, the stock price of casino stocks can be said to have braved the wind and waves, but can the upward trend continue?
Both experts believe that there may be taking back.
Wen Jie: Macau gambling stocks still have a consolidation in the short term
Wealth management strategist Wen Jie of Everbright Sun Hung Kai believes that the estimated and earlier market expectations will be cleared, and that the epidemic situation has not deteriorated at that time. At the same time, market participants also predict that the gaming revenue in November and December may have an increase. improve.
However, with the emergence of the fourth wave of the epidemic in Hong Kong and the global epidemic continues to worsen, the entire gaming stocks have also retreated or consolidated.
In the short term, I believe there will still be consolidation. It is recommended that investors who have not purchased the goods can wait until the epidemic has further subsided or the stock price has fallen to a relatively low level.
Wen Jie is relatively favored by GEG (0027), suggesting that investors can wait for it to fall back to RMB 57 to RMB 58 before buying.
(Photo by Luo Junhao)
At the same time, investors should be relatively cautious in handling foreign or U.S.-related high gambling stocks.
He explained that because the issue of license renewal in the gaming industry will still be discussed in the future, and the market is still worrying about the relationship between China and the United States.
On the other hand, the chances of successful renewal of Australian-funded or Chinese-funded gaming stocks are relatively high, so investors are advised to pay attention to gaming stocks with Australian or Chinese-funded backgrounds.
Among the many casino stocks, Wen Jie is relatively favored by GEG, suggesting that investors can wait until it falls back to RMB 57 to RMB 58 before buying.
At the same time, the relatively backward SJM can also pay attention.
Because SJM is a Macau fund, the chance of successful renewal is relatively high.
However, investors should pay attention to the recent decline of SJM. It is recommended to wait for it before falling back, and absorb it at about 8.5 yuan to 8.6 yuan.
Guo Sizhi: "The stock price has moved three steps faster, and the gambling collection is only half a step."
Guo Sizhi, vice chairman of the Hong Kong Equity Analyst Association, believes that although the worst "worst and worst" time in the gaming industry has passed since the Macau epidemic, he believes that gaming-related stocks are indeed "going too fast", describing this situation "The stock price has moved three steps faster, and the gambling collection is only half a step."
He also believes that even if the market repeatedly pushes upwards in December, a lot of gaming stocks are still entering a stage of consolidation.
We have to wait for the gambling revenue to truly return to a normal and bright number, and only then can we look forward to a further rise in the gambling stocks.
Guo Sizhi hypothesized that if the market hits the 10-day antenna in December, or there is a normal take-off, although gaming stocks will experience repetitions, I believe they will not fall to their previous lows.
Guo Sizhi believes that although the “worst and worst” time of the gaming industry has passed since the Macau epidemic, he believes that gaming-related stocks are indeed “going too fast” (photo by Gong Jiasheng)
Guo Sizhi pointed out that if investors choose to eat pasta, they will have no problem first, and then they can observe the market situation early next year before making a decision.
If the market continues to move up early next year, there may be better choices then.
On the contrary, if the situation is adjusted downward, it is not too late to reenter the low position.
But he said frankly that the stock price of the gaming industry is indeed going faster, and he doesn't think it is the time to take a heavy position.
It is recommended that if it is a heavy warehouse, you can choose half of the paste first; if you only have a small amount in your hand, and you have enough holding capacity, there is no problem.
Investors who are really interested in entering the market can first endure "Wait, it doesn't hurt."
Guo Sizhi has a neutral view of the gaming industry as a whole. He believes that if Macau's gaming industry slowly picks up, GEG's advantage will be more obvious than others.
However, in the short term, the current price of GEG is indeed higher. If GEG loses the support of the 60 yuan position, it may fall back to the 57 yuan to 58 yuan position.
Macau's October gambling revenue fell more than 70% year-on-year and rebounded more than 2 times month-to-month
Macau's gaming industry shows no improvement during Golden Week, experts say casinos will be considered after the epidemic
Gambling stocks under pressure across the board, Melco fell 3.5%, Macau's September gambling closed down 90%
Wynn Macau Macau Gaming Industry Investment and Wealth Management
