Investors Worry About Visa Restrictions Hurting Macau Casinos

Investors Worry About Visa Restrictions Hurting Macau Casinos
Business in Macau casinos is continuing to climb, but there has been a slow down in the revenue growth over the past few months that has caused investors to raise their eyebrows. Macau has the most profitable gaming industry in the world, and that may not be enough for investors who have grown weary of some new rules that may go into effect.In May, revenue increased at Macau casinos by 7.3%. That figure would be considered above average for most gaming industries, but Macau casinos have seen growth numbers in the 40 to 50 percent range over the past several years. The slow growth in May, coupled with rumors about visa restrictions have officials concerned about the financial stability of the casinos.”Recent weakness in Macau gaming revenue and visitation growth could be partially explained by the visa restrictions and reduction in China UnionPay limits highlighted by the Macau Daily,” said Cameron McKnight, an analyst at Wells Fargo. “While expectations have recently moderated, we believe out-performance in the Macau stocks is likely to be limited here.”A couple of years ago, the Chinese government issued visa restrictions for mainland China residents. Those restrictions caused Macau gaming stocks to drop, and the restrictions were also cutting into the casino gains. Shortly after, the restrictions were lifted, and Macau casinos have been on a revenue tear ever since.”The only thing that can slow down the gaming train that has been created from mainland China to Macau casinos is the government interfering and implementing visa restrictions again,” said Gaming Analyst Steve Schwartz. “If the rumors are true, and the restrictions are put in place, Macau stocks could be in for another round of decreasing prices.”Macau surpassed Nevada as the gaming capital of the world a few years ago. Las Vegas has not been the same since Asian gamblers decided to stay closer to home, spending their large amounts of gambling money in Macau. New Jersey’s gaming industry has also been affected by the rise of the Macau casinos. Atlantic City casinos have been struggling for the past four years, and only recently showed signs of breaking out of their revenue slump. June 27, 2012Posted By April GardnerStaff Editor, CasinoGamblingWeb.comSubmit News!