Core Viewpoint - Morgan Stanley has issued a report rating Wynn Macau (01128) as "Overweight" with a target price of HKD 7.4, indicating a cautious outlook despite some positive indicators in the gaming sector [1] Financial Performance - Wynn Macau's EBITDA for Q4 2025 is projected at USD 271 million, reflecting a quarterly and year-over-year decline of 12% and 7% respectively; adjusted EBITDA is expected to be USD 287 million, showing a quarterly increase of 1% but a year-over-year decrease of 2%, aligning with Morgan Stanley's expectations but falling short of market expectations [1] - Over the past year, Wynn Macau's corporate EBITDA has decreased by 7% year-over-year, underperforming compared to peers in the industry [1] Market Context - The total gaming revenue in Macau has increased this year, with Wynn Macau's gaming revenue in January surpassing that of Q4 last year [1] - The new Chairman's Club at Wynn Palace is set to open before the Lunar New Year, which may enhance customer experience and revenue potential [1] - Retail rental income in Q4 has increased by 28% quarter-over-quarter, indicating a positive trend in non-gaming revenue streams [1] Investment Considerations - The current valuation of Wynn Macau is below the industry average, suggesting potential for upside; however, investor reluctance towards less liquid stocks persists unless the company can capture market share, which did not occur in Q4 [1] - Simply relying on low valuations may not be sufficient to attract investors to Wynn Macau [1]

Core Viewpoint - New Macau International Development reported significant financial improvements for the fourth quarter and the full year ending December 31, 2025, with notable increases in total operating revenue and net income compared to the previous year [1][2]. Group 1: Quarterly Performance - For Q4 2025, total operating revenue reached $1,290,000,000, a 9% increase from $1,190,000,000 in Q4 2024, driven by improved overall betting amounts [1]. - The operating income for Q4 2025 was $146,400,000, compared to $97,000,000 in Q4 2024 [1]. - The net income attributable to New Macau International Development for Q4 2025 was $60,600,000, or $0.16 per American Depositary Share, a turnaround from a net loss of $20,300,000, or -$0.05 per share in Q4 2024 [1]. Group 2: Annual Performance - For the year ending December 31, 2025, total operating revenue was $5,160,000,000, up from $4,640,000,000 in 2024, attributed to improved performance across all gaming and non-gaming segments [2]. - The operating income for 2025 was $600,400,000, compared to $484,600,000 in 2024 [2]. - Adjusted property EBITDA for 2025 was $1,430,000,000, an increase from $1,220,000,000 in 2024 [2]. - The net income attributable to New Macau International Development for 2025 was $185,000,000, or $0.46 per American Depositary Share, compared to $43,500,000, or $0.10 per share in 2024 [2].

Investment Rating - The report does not explicitly state an investment rating for Melco International Development Core Insights - Melco International Development's subsidiary, Melco Resorts & Entertainment, reported a net revenue of USD 1.31 billion for Q3 2025, representing an 11.4% year-over-year increase. The adjusted EBITDA reached USD 0.352 billion, up 16.3% year-over-year, with an adjusted EBITDA margin of 26.9%, an increase of 1.13 percentage points year-over-year [1][9] - The company's total betting amount in Macau reached USD 10.9 billion, a 24.3% year-over-year increase, with VIP betting amounting to USD 5.58 billion, reflecting a 47.0% year-over-year growth [3][11] - The company's market share in Q3 2025 was 14.6%, down from 15.8% in Q2 2025, indicating a decline in market position [6][14] Summary by Sections Financial Performance - In Q3 2025, Melco International Development achieved operating revenue of USD 1.31 billion, a year-over-year increase of 11.4%. The adjusted EBITDA was USD 0.352 billion, up 16.3%, with an adjusted EBITDA margin of 26.9%, an increase of 1.13 percentage points year-over-year. For the year-to-date, the operating revenue reached USD 3.87 billion, up 12.3%, and adjusted EBITDA was USD 1.017 billion, up 16.9% [1][9] - The company's gaming gross revenue (GGR) in Macau was USD 1.13 billion, up 11.8% year-over-year, but this growth rate was lower than the industry average of 12.5% [4][12] Business Segments - In Macau, the company's operating revenue was USD 1.1 billion, with gaming and non-gaming segments contributing USD 0.92 billion and USD 0.19 billion, respectively. The gaming segment grew by 12.3% year-over-year, while the non-gaming segment grew by 7.2% [2][10] - The adjusted property EBITDA for the company in Macau was USD 0.317 billion, reflecting a year-over-year increase of 21.1% and an adjusted EBITDA margin of 28.7%, up 2.3 percentage points year-over-year [5][13] Market Dynamics - The total betting amount in Macau increased significantly, with VIP betting showing the highest growth at 47.0% year-over-year. The VIP win rate for the City of Dreams was reported at 3.68%, exceeding the expected range [3][11] - The company's market share has declined, with a noted decrease from 15.8% in Q2 2025 to 14.6% in Q3 2025, indicating competitive pressures in the market [6][14]

Core Viewpoint - The performance of 澳博控股 in 2Q25 fell short of market expectations, with a net income of HKD 7.16 billion, reflecting a 4% year-on-year growth but a 4% quarter-on-quarter decline, returning to 85% of the level seen in 2Q19 [1] Financial Performance - The adjusted EBITDA for the company was HKD 688 million, down 21% year-on-year and 28% quarter-on-quarter, recovering to 69% of the level in 2Q19, and was below Bloomberg's consensus estimate of HKD 939 million [1] - Daily operating costs increased by HKD 900,000, representing a 9.9% year-on-year growth and a 4.4% quarter-on-quarter growth, with management expecting future daily operating costs to continue rising by HKD 100,000 to HKD 200,000 [1] Development Trends - 澳博 signed an agreement with 澳娱综合 to acquire 7,504 square meters of space in the 澳门葡京酒店 for HKD 539 million, which is expected to allow the allocation of 25-35% of the satellite gaming tables (458 tables) in the newly acquired area, potentially doubling the number of gaming tables at the 澳门葡京酒店 [1] - Management plans to increase marketing rebate expenditures to compete with peers in Macau [1] - The company is seeking to raise funds through mortgage loans for the acquisition of 澳门凯旋门 and 十六浦 properties by the end of 2025, and will refinance a USD 500 million bond maturing in January 2026 through bank loans [1] Earnings Forecast and Valuation - The adjusted EBITDA forecasts for 2025 and 2026 remain unchanged, with the company's stock price corresponding to a 10x adjusted EV/EBITDA for 2025 [2] - The target price has been raised by 19% to HKD 2.50, corresponding to an 8x adjusted EV/EBITDA for 2H25e+1H26e, indicating a 25% downside potential from the current stock price [2]