Fitch Ratings has reaffirmed Las Vegas Sands’ (NYSE: LVS) credit rating at “BBB-,” the lowest tier of investment grade, maintaining a “stable” outlook. The agency pointed to strong cash flow prospects and the performance of Marina Bay Sands in Singapore as key reasons for the rating.
While the Macau market—home to Sands China’s five casino properties—remains sluggish, Fitch noted the company’s advantages, including its scale, market position, and robust free cash flow. These strengths are tempered by significant capital expenditures and economic uncertainty in China.
Sands regained its investment-grade status in February 2024 after being downgraded during the early stages of the COVID-19 pandemic. Fitch highlighted the company’s improving EBITDA outlook, which supports its efforts to reduce leverage.
Path to a Potential Upgrade
Fitch estimates Sands’ EBITDA leverage at 3.5x, indicating that a further reduction below this threshold could lead to an upgraded rating. The company’s liquidity remains strong, with $4.2 billion in cash and ample access to credit. Still, Fitch warned of risks such as persistently high leverage or any deterioration in liquidity.
The agency praised Sands for its disciplined financial management and transparent communication with investors, especially regarding its leverage strategy. This prudence contributes to its solid credit standing and positions the company for a possible future upgrade.
Healthy Financial Flexibility
Despite buybacks and dividend growth initiatives, Fitch believes Sands has sufficient free cash flow to support shareholder returns and upcoming debt obligations for Sands China.
Looking ahead, potential credit upgrades could come from continued deleveraging and greater geographic diversification. While Sands currently operates six integrated resorts (five in Macau and one in Singapore), future growth may hinge on securing a gaming license in the New York City area, potential casino legalization in Texas, or entry into Thailand’s casino market.
Explore the best online betting site Singapore with Octabet betting news. Start winning today! Register now!
