Why Is Las Vegas Sands (LVS) Rated as Buy?

Las Vegas Sands may be overvalued with poor growth indicators, but the 15 analysts following the company give it an average rating of buy. The analysts have set target prices ranging from $52.0 to $76.0 per share, for an average of $64.15. At today's price of $60.12, Las Vegas Sands is trading -6.27% away from its average target price, suggesting there is an analyst consensus of some upside potential.

Las Vegas Sands Corporation is an American casino and resort company based in Paradise, Nevada, United States. Its resorts feature accommodations, gambling and entertainment, convention and exhibition facilities, restaurants and clubs, as well as an art and science museum in Singapore. The large-cap Consumer Discretionary company is based in Las Vegas, NV. Las Vegas Sands has offered a 6.88% dividend yield over the last 12 months.

Las Vegas Sands does not have a meaningful trailing P/E ratio since its earnings per share are currently in the red. Based on its EPS guidance of 2.72, the company has a forward P/E ratio of 22.1. In comparison, the average P/E ratio for the Consumer Discretionary sector is 22.33. Furthermore, Las Vegas Sands is likely overvalued compared to its book value, since its P/B ratio of 9.27 is higher than the sector average of 3.12.

So why does Las Vegas Sands get a good rating from most analysts despite its lofty valuation? One reason could be its attractive average yearly EPS growth rate of 46.0%.

2019-12-31 2020-12-31 2021-12-31 2022-12-31
Revenue (MM) $12,127 $2,940 $4,234 $4,110
Revenue Growth n/a -75.76% 44.01% -2.93%
Gross Margins 91.02% 45.58% 55.34% 51.7%
Gross Margins Growth n/a -49.92% 21.41% -6.58%
Operating Margins 27.75% -47.38% -16.27% -19.27%
Operating Margins Growth n/a -270.74% 65.66% -18.44%
Earnings Per Share $3.53 -$2.21 -$1.26 $2.4
EPS Growth n/a -162.61% 42.99% 290.48%
Diluted Shares (MM) 764 764 764 764
Free Cash Flow (MM) $1,769 -$2,642 -$2,214 $134
FCF Growth n/a -249.35% 16.2% 106.05%
Capital Expenditures (MM) $1,269 $1,330 $828 $651
Net Debt / EBITDA 1.98 -93.13 19.17 3.46
The above analysis is intended for educational purposes only and was performed on the basis of publicly available data. It is not to be construed as a recommendation to buy or sell any security. Any buy, sell, or other recommendations mentioned in the article are direct quotations of consensus recommendations from the analysts covering the stock, and do not represent the opinions of Market Inference or its writers. Past performance, accounting data, and inferences about market position and corporate valuation are not reliable indicators of future price movements. Market Inference does not provide financial advice. Investors should conduct their own review and analysis of any company of interest before making an investment decision.