Goldman Sachs: Macau September gaming revenue down 1% year-on-year, in line with expectations; expects stable third-quarter EBITDA

Goldman Sachs Group, Inc. released a research report stating that Macau's September gaming revenue (GGR) fell 1% year-on-year to MOP 18.1 billion (same unit below), broadly in line with lowered market expectations, at 82% of the level in the same period of 2019, affected by the seasonal lull after the summer holidays and before the National Day Golden Week; implying that average daily gaming revenue in the last 10 days of September remained at MOP 587 million, compared with MOP 586 million and MOP 614 million in the preceding weeks respectively. The report noted that third-quarter gaming revenue totaled MOP 60.2 billion, down 1% quarter-on-quarter and 4% year-on-year, partly reflecting the diversion of some gaming spending during the July World Cup period. For the first nine months of this year, gaming revenue rose 3% year-on-year, in line with the bank's full-year forecast of 3% year-on-year growth, while the comparison base for November to December will be more favorable. At the same time, the bank expects third-quarter EBITDA to remain relatively stable quarter-on-quarter, and believes that with a lower base for gaming revenue and daily operating expenses, particularly in November to December, the fourth quarter could see a more meaningful valuation re-rating. The bank believes current sector valuations remain attractive; based on quarter-to-date trends, it believes GALAXY ENT (00027) may significantly gain gaming revenue market share, while Melco Resorts (MLCO.US) market share may come under pressure.