Pros and Cons of Investing in Las Vegas Sands

PHOTO CREDIT: Las Vegas Sands

OVERVIEW

Las Vegas Sands Corporation is a company based in the United States. The company operates a chain of hotels and casinos around the world Some of the companies properties include The Venetian (in Las Vegas and Macao), Marina Bay Sands (Singapore), and The Parisian (Macao). The company was founded in 1988.

Why You Should?

1. Las Vegas Sands is a great reopening play in an investor’s portfolio. The company had to close all of its properties during the pandemic. However, once the pandemic is over, people will go back outside and travel again. This will increase the demand for the services that Las Vegas Sands offers.
2. Las Vegas Sands will also benefit from pent-up leisure travel demand. As people were locked down and stayed indoors for over a year, the demand for leisure travel will (and has) come skyrocketing back (hence the term “pent-up” demand). This will benefit the company as they will see sales rise and will also help them recover. This will also benefit investors.
3. Las Vegas Sands owns a couple of properties in the United States, a country that has one of the highest vaccination rates in the world. Because of this, its locations in Las Vegas have been fully reopened. This will help the company recover domestically, something that will help the company and its investors.
4. Las Vegas Sands operates some of the most luxurious hotels and casinos in the world. For example, the Venitian in Las Vegas is one of the most popular hotels on the Las Vegas Strip. The Marina Bay Sands is also a must-see destination in Singapore. This good brand recognition will benefit the company as they will be able to gain new customers.

Why You Should Not?

1. The company faces tough competition in the hotel and casino business. Some of these companies include Mariott, Hilton, MGM, and Wynn. This competition might hurt the company and its investors in the future.
2. The COVID-19 pandemic has also negatively impacted the company. During most of 2020, the company had to fully shut down all of its casinos as local governments regulated leisure travel and imposed lockdowns. This hurts the company which had one of the worst years in its history. This also hurt investors in the company.
3. A slow return of international hotels and casinos in China and Singapore might hurt the company. This is because of low vaccination rates and more cautious government reopenings. This will continue to hurt the company until the pandemic is over for everyone.

MY OPINION

In my opinion, I think that Las Vegas Sands is a decent long-term investment due to its position as a good reopening play, the pent-up travel demand, good brand recognition, as well as high domestic vaccination rates. However, tough competition, negative impacts from the pandemic, and a slow international recovery might hurt the company and its investors in the future.