NEW YORK, NY--(Marketwire - Aug 14, 2012) - After a strong start to the year, casino stocks have begun to falter as Macau's gambling revenue growth has slowed. The Market Vectors Gaming ETF (BJK) -- which replicates an index consisting of publicly traded companies engaged in the global gaming industry -- has fallen roughly 10 percent in the last three months. Five Star Equities examines the outlook for companies in the Resorts & Casinos Industry and provides equity research on Wynn Resorts, Limited (NASDAQ: WYNN) and Caesars Entertainment Corp. (NASDAQ: CZR).
Macau's gambling revenue in July saw its slowest growth in over three years. The Chinese gaming region's July revenues totaled $3.08 billion dollars, a 1.5 percent year-over-year increase. July's growth was the slowest since June 2009, during the financial crisis. China's gambling mecca has seen a decrease in demand as their "VIP" gamblers from mainland China have been feeling the effects of a slowing Chinese economy.
Grant Govertsen, analysts at Macau based Union Gaming, expects gaming revenues to see low-single-digit growth in August before bouncing back to double digits in September. "All in, we are expecting third-quarter gross gaming revenue growth in the mid-single-digits. Looking further out, we expect full-year 2012 GGR growth to reach the teens," said Grant Govertsen.
Last week the Nevada Gaming Control Board reported that Nevada casino revenue fell 6 percent for the month of June. Across the state in June casinos took $832.5 million from gamblers, a decrease from the $885.7 million in June 2011. This was the second consecutive monthly decline, and the third in four months said Mike Lawton, senior analyst with the control board.
Revenues from the Las Vegas Strip, which accounts for more than 50 percent of the total, declined 4.5 percent to $483.7 million in June. Slot betting on the Las Vegas Strip declined $63.2 million to $3.1 billion in June. "We've had three consecutive declines for slot volume on the Strip," Lawton said. "We're a little concerned about that. We've lost some steam this quarter, for sure."