Casino stocks have been see-sawing for much of 2021, although the consensus is that most gambling and hospitality companies ended up in the doldrums so far as their stock price goes.
However, just because they crashed doesn’t mean cheap stocks should be avoided. There are some reasons to be out there looking to buy into casino shares, and one such is Las Vegas Sands.
Goldman Sachs is confident that 2022 will allow LVS to start climbing back up and that buying the stock early into the year would be the best course of action. The investment bank did not allocate much to Las Vegas Sands as a stock, but it still featured it on its list of potential stocks to recover in the year.
However, the fact that Goldman Sachs has only shortlisted the Las Vegas Sands as the only gaming equity to make a list, which doesn’t spell a rosy picture for such assets in general.
Not All Is Lost for Casino Stocks
Even though Goldman Sachs has limited itself to just Las Vegas Sands, both Fitch and JP Morgan believe that casinos in Macau are safe, and by extension, their stocks should improve. If anything, though, stocks such as Las Vegas Sands are high quality.
A temporary drop of value is not an indicator of the long-term resilience of the stock. Las Vegas Sands will be rejoining the race for a casino resort in Japan, and the company’s Asia pivot has been strong over the years.
Even though LVS divested a lot during the pandemic from its real estate portfolio in Nevada, the company is now eyeing other territories, including Texas, which it believes can host a world-class casino resort, providing legislation lays the groundwork for such.
Meanwhile, LVS is also expected to close the sale of its iconic The Venetian and Sands Expo and Convention Center properties and collect $6.25 billion, which should prop up any future plans of expansion. Macau and Singapore remain important.
Should You Buy LVS Stock Now?
Trading at $37.66 at the time of reporting, the LVS stock could be a good buy if you are looking to buy into this space. The company is one of the most resilient behemoths in the market and even though it has been eager to retain its land-based dominance, it’s now opening to interactive options.
The stock was last past the $50 trading mark in July 2021, but it’s possible to see it inch up throughout 2022 which is what Sachs is counting on. Regardless, you probably should not be purchasing stocks if you are looking to cash in within a year. Las Vegas Sands equity is more of a marathon than a sprint.
Meanwhile, CNBC’s Jim Cramer has chilled enthusiasm for gaming stocks this year, cautioning that you should probably wait a while before you buy.