Las Vegas Sands Corp. (NYSE: LVS) reported this morning that one of its subsidiaries has filed an application to list its shares on the Hong Kong Stock Exchange. The move was widely expected, as LVS CEO Sheldon Adelson said in July that the casino firm was considering an initial public offering (IPO) or sale of its Macau assets.
"No decisions have been made regarding the timing or terms of any such offering or whether the subsidiary will ultimately proceed with such a transaction," reported LVS in a filing with the Securities and Exchange Commission (SEC).
However, JPMorgan analyst Joseph Greff said the IPO could take place before the end of the year. "We believe this moves [LVS] one step closer to a clearer path of much needed improving liquidity and balance sheet de-levering," he wrote in a research note this morning.
Many analysts expect that the casino business in Macau will recover at a faster pace than Las Vegas. Sector peer Wynn Resorts (NASDAQ: WYNN) filed for an IPO of its own Macau unit in late July.
LVS is up more than 4% at last check as investors cheer the potential IPO. The stock has collected an impressive year-to-date gain of 115%, despite lingering concerns about the gaming sector's ailing fundamentals.
Shares of the casino concern appear to have finally established a solid foothold in double-digit territory, and they're currently cresting higher along short-term support at heir 10-day and 20-day moving averages. With short interest still accounting for 17.6% of LVS' available float, there's no shortage of sideline cash to perpetuate the stock's rally.
Elizabeth Harrow is an analyst and financial writer in the research department at Schaeffer's Investment Research. She is featured in the video series Schaeffer's Daily Q&A on SchaeffersResearch.com.
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