What Happens in Macau, $tays in Macau

As more and more people in China become richer, travel and hospitality services are booming. Even gambling industry in Macau has benefited from the increasingly heavy wallets of Chinese tourists. Table bet in Macau is as high as 10 to 1 compare to Las Vegas. That’s the main reason Las Vegas Sands and Wynn Resorts are pouring huge investment to build casinos and resorts in Macau.

People in China who want to experience Las Vegas, they don’t need to go through a timely U.S. visa process anymore. They just go straight to Macau.

Las Vegas Sands Corp. (LVS) Wynn Resorts Ltd.(WYNN) MGM Mirage (MGM) Boyd Gaming Corp. (BYD)

The traditional casino model goes like this: borrow billions, build casino, operate casino, minimize losses at the tables, borrow against first casino, design new casino, repeat.

06-Mar-2008: Are Casino Stocks No Longer Recession-Proof?

29-Feb-2008: Terry Lanni is transitioning MGM Mirage from a debt-heavy casino builder into a diversified real estate developer--using other people's money.

13-Feb-2008: Billionaire Stephen Wynn, CEO Wynn Resorts, predicted upcoming Las Vegas softness.

12-Feb-2008: Wynn Resorts swung from a loss a year earlier to a profit of $65.5 million in the fourth quarter, pushed by sharply higher VIP business in the Chinese gambling strip of Macau.

08-Jan-2008: Lawrence Klatzkin of Jefferies & Co. said in a client note that Macau total market size could exceed $15 billion by the end of 2010. The 2007 Macau total market size is estimated at approximately $10.4 billion.