Melco Resorts & Entertainment(US:MLCO) HTSC·2025-05-11 07:25Investment Rating - The investment rating for the company is maintained at "Buy" with a target price of HKD 4.10 [7][4]. Core Insights - The company's gaming revenue recovery in Macau has outperformed the industry, with a market share increase to 15.7% in Q1 2025 from 14.7% in Q4 2024 [1][2]. - The total GGR for the company in Q1 2025 reached USD 1.299 billion, which is 80% of the GGR from Q1 2019, surpassing the industry average of 76% [1][2]. - The company has shown improvements in EBITDA margins, with an overall EBITDA margin of 27.7% in Q1 2025, up from 24.9% in Q4 2024 [2][4]. Financial Performance - The company's net revenue for Q1 2025 was USD 1.232 billion, a year-on-year increase of 11%, with adjusted property EBITDA of USD 341 million, up 14% year-on-year [2]. - The EBITDA margin for the company's properties has shown a positive trend, with Macau's EBITDA margin at 29.8% for Q1 2025, reflecting a 6 percentage point increase from the previous quarter [2]. - The company reported a total debt of USD 7.16 billion, with a debt-to-asset ratio of 90.6% as of March 31, 2025 [1]. Visitor Trends - Visitor numbers to Macau during the May Day holiday exceeded expectations, with an average of 170,000 visitors per day, significantly higher than the tourism bureau's forecast of 127,000 to 140,000 [3]. - The company reported a 30% year-on-year increase in visitor numbers to its properties during the May Day holiday [3]. Market Outlook - The company plans to enhance its capital structure and continue cost reduction initiatives, with a focus on improving operational efficiency [1][4]. - The target price has been adjusted upwards to HKD 4.10, reflecting a valuation of 6.7x EV/EBITDA for 2025 [4].