The leading global provider of credit ratings, research and risk analysis, Moody’s Investor Service, released a new update, highlighting important details regarding the credit profile of the global gaming and entertainment giant, Las Vegas Sands (LVS). Earlier this week, the company published a credit analysis, highlighting that currently, LVS has a Stable Outlook. Moreover, Moody’s reiterated the company’s current credit profile with its “Baa3” rating.
According to the global credit ratings provider, the Stable Outlook and credit rating recognize the gaming company’s strong position. Additionally, Moody’s wrote that the credit rating is complemented by the gaming company’s “high quality, popularity, and favorable reputation of its casino properties and positive long-term gaming demand trends in LVS’s geographic markets.”
The recent divestments of LVS assets in Las Vegas enabled the company to focus on markets such as Singapore and Macau. In fact, near the end of last year, the company confirmed it increased its stake in Sands China. This strategic move came during an important moment for the market in Macau as it was past the long post-pandemic recovery period.
More recently, LVS confirmed that the next phase of the transformation of Marina Bay Sands, its flagship property in Singapore, was initiated. The strategic phase represented a reinvestment of a whopping $750 million, involving the transformation of Tower 3.
The Credit Ratings Firms Confirms Potential Credit Risks
Despite the credit rating and Stable Outlook, Moody’s said that investments related to the international expansion of LVS may temporarily impact its future credit profile. “Key credit concerns include the likelihood that LVS will continue to pursue further and significant global casino resort development opportunities that will likely be funded largely with debt that could lead to temporary leveraging,” explained the leading credit ratings firm.
Finally, Moody’s wrote: “In addition, the likelihood that LVS will return capital to shareholders in the form of share repurchase and dividends as operations have ramped back up remains a credit constraint.”
Back in March, LVS’ CEO, Robert Goldstein, divested $5.2 million in company shares, a Form 144 filing with the Securities and Exchange Commission revealed. This involved the sale of 100,000 shares of Class A Common Stock in the company, valued at $5,236,000.