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The properties held by the Las Vegas Sands Corporation in Singapore are doing extremely well despite the global economic crisis. Also, analysts believe that a reevaluation of the Chinese Yuan will help the company further. This growth is primarily attributed to the huge increase in visitors each month since Singapore added two additional resorts.

Arrivals are Increase

Since January 1^st, 2010, the number of arrivals from visitors to the resorts has increase by 23 percent. As a result, analysts have upgraded their forecasts and now believe that each resort will appeal to a variety of new tourists thus further increasing the number of guests than previously thought.

The Reevaluation of the Chinese Yuan

Since the Chinese Yuan is being reevaluated, it will greatly improve the company’s financial statements. Currently, the Sands own three resort-casinos in Macau, which is a Chinese gambling area similar to Las Vegas. Their other properties on the Las Vegas strip include the Venetian and the Palazzo.

The United States continues to put pressure on China to allow the value of the Chinese Yuan to rise in relation to the U.S. dollar. U.S companies believe the Chinese Yuan is undervalued by approximately 40 percent to the U.S. dollar. As a result, Chinese products are less expensive and more competitive compared to finished goods manufactured in the United States.

In June, the Chinese government announced it will allow for more flexibility in its currency value. Unfortunately, since then the Yuan has improved less than 2 percent against the dollar. Once a full reevaluation is completed, the Sands finances will greatly improve due to the dollar to Yuan currency rate.

The Sand’s

The Las Vegas Sands is the world’s second largest gaming company after Harrah’s Entertainment Inc. Analysts have lifted the original 2010 share estimate from $0.52 per share to $0.84 per share. The 2011 estimate was $0.85 per share but is now $1.25 per share. These numbers look quite promising for the company and investors alike.

The huge increase in visitors and the reevaluation for the Chinese Yuan will be two areas that may save this company. With a strategic location in Macao, a growing gambling area of China, not only are the number of guests increasing, but the fact that the Chinese Yuan is undervalued with greatly help this company get back on its feet and become more competitive with Harrah’s.

The gaming industry’s big three, MGM Mirage, Sands and Wynn, saw a decline in their stock prices during the month of May. The previous month, the three corporations witnessed a wild and unexpected upswing due to a recovering economy. Luckily, these declines didn’t hurt local casino operators that are under the corporate umbrella or gaming equipment manufacturers.

In April 2010, all three organizations saw double digit jumps in stock prices. May 2010 brought about daily average decreases in stock prices. Applied Analysis, which records the average stock price of six major casinos, believes this occurred for three reasons:

1. Investor speculation of the large purchase of MGM Mirage’s stock
2. Sands restarting construction in Macau
3. The European financial crisis

The first reason is that investors speculated the purchase of a large portion of stock by a hedge fund. Paulson and Company, based out of New York, purchased 40 millions shares of MGM Mirage, making them the second largest shareholder of the company. This resulted in an increased pressure on pricing within the gaming industry.

The second reason is that the Las Vegas Sands restarted construction at the Cotai Strip in Macau. This project was halted for nearly 18 months. Finally the European financial crisis has significantly decreased travel to the United States and overall spending, especially in major casino resort areas. This has also resulted in flights being cut to Las Vegas from around the world.

Major casino area’s like Las Vegas and Atlantic City may take a much longer time to recover from the global financial crisis. The Aqueduct Racetrack in the New York City area may add table games. This would eliminate the need for area residents to go to Atlantic City. Also, casinos in Pennsylvania will also be offering table games as early as this summer. As a result, this will limit the need of residents to go to large casino areas.

On the other hand, many slot machine makers like International Game Technology, Bally Technologies and WMS Industries experienced a strong month of May with the average daily stocks improving by two percent overall.

Although casinos have taken a slight hit during the month of May, there is no doubt they will recover. Due to clever strategic moves by smaller competing casinos, the recovery process may be slower than desired. Major casino destinations have had their fair share of ups and downs, always coming out on top.