Casino Stock Slides After Scrapped Japan Plans

Las Vegas Sands now sees its goals in Japan as "unreachable"

by Jake Scott

Published on May 13, 2020 at 10:07 AM
Updated on Jun 24, 2020 at 10:16 AM

The shares of Las Vegas Sands Corp. (NYSE:LVS) are down 1.1% to trade at $45.50, after the casino developer axed its Japanese casino pursuits. Although no specific reason was given, all signs point to the coronavirus pandemic. After the company made quick recoveries in other Asian marketsLVS CEO Sheldon Adelson said in a statement, "It is time for our company to focus our energy on other opportunities. 

LVS has spent the last three weeks or so trading in a tight range, with the $50 level keeping a lid on breakouts, and the $45 level containing any pullbacks. The shares face a 34.4% year-to-date deficit, with additional resistance emerging at their 60-day moving average.

Still, the majority of analysts are optimistic about Las Vegas Sands stock. Of the 10 in coverage, seven brokerages sport a "strong buy," and not a single "sell" to be found. Meanwhile, the 12-month consensus target price of $59.98 is a huge 30.3% premium to current levels, which could signal some price-target cuts in the near future that would put additional pressure on the security.

In the options pits, LVS sports a 10-day call/put volume ratio of 4.01 at the International Securities Exchange (ISE), Cboe Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), which sits in the elevated 86th percentile of its annual range. This suggests that the appetite for calls is healthier-than-usual in the last two weeks

Meanwhile LVS' near-term options are attractively priced at the moment. Schaeffer's Volatility Index (SVI) stands at 58%, in the 24th percentile of its annual range. This indicates that now is an attractive time to jump aboard the streaming name with options. Even further, the equity has been more volatile than expected during the past 12 months. This is based on its Schaeffer's Volatility Scorecard (SVS) of 91 (out of 100.)


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