Las Vegas Sands: Putting Faith in Sheldon Adelson
August 26, 2008 at 11:30 AMPosted by Thomas Catino
"Put simply, Las Vegas Sands' U.S. liquidity appears tighter than we initially thought and published following earnings," Banc of America’s Shaun Kelley said in his Friday downgrade of Las Vegas Sands Corp. (LVS). But put simply, the market has already largely discounted a lot of those fears in the share price and the downgrade seems ill-timed. In the five trading sessions prior to the analyst downgrade, the stock was off by 38.6% while in the two days after the bearish comments, the casino stock actually moved higher by 1.2% to $41.89. And CEO Sheldon Adelson (the world’s twelfth richest person at $26 billion) emphatically assured during the second quarter conference call that although there were funding needs, there would not be any liquidity problems. This exchange during the call, courtesy of SeekingAlpha, says it all; “A friend of mine says that... I don't equal the height of Yao Ming or LeBron James or any of the basketball players. Ming isn't here, but LeBron James and Kobe Bryant and other top players are here in Macau. However, one of my closest friends says, Sheldon, don't worry about your height. You're the tallest person I know when you stand on your wallet. And I'm saying right now the company will not have liquidity problems.” The dialogue implies that in a worst case scenario, Adelson would back the company with his own money. Thus, you can put your faith in Adelson and bet that Las Vegas Sands is a pretty good bounce candidate at this level.
Hotels and airline tie-ups have become quite a common practice in the present times. Not only on the international level even in the domestic sectors the hotels airline tie-ups have accelerated tremendously. Due to the rise in the airfares, the whole of the aviation industry is going through a lean phase. Under these circumstances these kinds of tie-ups bring in the much-required revenue both for the airlines and the hotels. In an airline hotel tie-up more often than not 4star, 5star, or 7star hotels are involved. This trend is fast catching up in the countries like India also. Apart from the hotels in the metros like Gurgaon hotels and Navi Mumbai hotels, Bangalore hotels and Ludhiana hotels are also trying to generate the maximum profits from hotel airline tie-ups.
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