CAN THE BULLS SAVE LAS VEGAS SANDS SHARES FROM FALLING FURTHER?

Las Vegas Sands, Corp.

has been an ugly duckling of a stock while the broader market was trading bullishly. Now that the market is getting hit with increased bearishness and volatility, LVS shares seem to be treading water – at least for the time being. The company has a great deal of uncertainty and concern from an outside / macro standpoint – growth and geo-political issues in Asia combined with growth / health concerns here in the US. Those concerns seem to be combining with an ugly technical picture to keep the selling pressure on the stock. When will things change for the better for LVS? What the bulls see in Las Vegas Sands: • Some reasonable valuation metrics: o An enterprise value of $56.51 billion that easily trumps the $49.42 billion market capitalization, and o A price to sales of 3.38 • Strong net profit margins of 17.85% • Positive levered free cash flow of $2.52 billion annually • A current ratio of 1.74 What the bears see in Las Vegas Sands: • A stock that still has farther to fall despite the damage that has been done already • Some rich valuation metrics: o A price-to-book ratio of 6.89 o A price-to-earnings of 15 as compared to next year's estimated revenue and earnings growth of 6.8% and 11% respectively. • A relatively high debt-to-equity ratio of 118.77%. The technical take on LVS… Technicians acknowledge that Las Vegas Sands' stock is in a strong downtrend, but they note that support for this third (out of five) wave lower comes in at $56.92 (from $61.24). That Fibonacci-generated number also corresponds with the long-term uptrend line for LVS. If LVS closes below that level, the next Fibonacci projection comes in at $52.87. In terms of resistance for the stock, there seems to be horizontal line resistance at $65, $70 and $73.18. Who will win out? It looks like LVS shares will drift a bit lower before a more substantial bounce should occur. However, rallies are to be treated as bounces instead of the beginning of a new uptrend for the time being – so say the technical crowd. Aggressive traders willing to take on the risk of buying a downtrending stock will be doing so down at or near the $56.92 level. Technicians caution prospective short-sellers against chasing after a stock that is this oversold.