Analyst: New Sands casino off to a good start

Jun 10, 2009 8:49 PM
Staff & Wire Reports |

Las Vegas Sands Corp.'s new Pennsylvania casino appears to be off to a good start, but the company must still find ways to deal with its looming debt load, an analyst said Wednesday.

Las Vegas Sands (LVS) opened the $743 million Sands Casino Resort Bethlehem late last month, and managed to rake in $10.7 million in gaming revenue in May, according to Janet Brashear of Bernstein Research.

The company stands to do even better in the future, as the Las Vegas-based company plans to add 2,000 more slots to the property in November. The casino could also get a boost from table games if Pennsylvania approves them, Brashear added.

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But Las Vegas Sands, led by billionaire Sheldon Adelson, must still find ways to reduce its debt, which stood at $10.41 billion at the end of the first quarter.

"By 2010 first quarter the rubber meets the road, and the company will need to have executed on one of its strategies to monetize assets or sell equity in order to avoid a breach," Brashear wrote in a client note.

Las Vegas Sands previously announced that it is considering selling some of its noncore assets in an attempt to boost its liquidity.

She reiterated an "Outperform" rating and $10 price target.

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Shares of Las Vegas Sands fell 11 cents to $9.64 in morning trading.