Sterne Agee Says Buy the Dip in Casino Stocks, Sees Visa, Credit Fears Overdone (LVS) (MGM) (WYNN)

June 26, 2012 12:16 PM EDT
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Sterne Agee's David Bain issued a note Tuesday morning suggesting recent downside in Casino & Gaming stocks related to speculation over tighter visa controls in China may have created a buying opportunity. Shares of Las Vegas Sands (NYSE: LVS) dipped 4 percent on Monday amid the concern, shares of MGM (NYSE: MGM) fell more than 4.5 percent, and Wynn (Nasdaq: WYNN) shares fell just over 1 percent.

The analyst pointed out this kind of speculation has pushed shares lower several times over the last few years, and, for the most part, has afforded strong entry points to the stocks. Bain said it is typical for visa controls to be tighter before July.

Another fear making the rounds on Monday was related to the use of credit cards for gaming within China. Bain noted Union Pay limits remain "extremely" high for big-time gamblers and also said VIPs generally don't use credit cards and instead play on credit through a junket provider.

Shares of Las Vegas Sands, MGM and Wynn are relatively quiet this afternoon, down 0.12 percent, up 0.4 percent and 0.05 percent, respectively.

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