On Thursday, Macquarie projected strong demand for Super Bowl LVIII, anticipating a positive impact on Las Vegas Strip revenue. The Strip recorded its highest monthly revenue in history with $905 million in December, a year-over-year increase of 11%.
This surge was fueled by significant growth in table games and slot machines, with baccarat volumes reaching nearly $1 billion, an 18% increase from the previous year. The robust performance in baccarat, coupled with favorable hold rates, led to a 50% year-over-year rise in baccarat revenues.
The firm anticipates Vegas Strip segments to outperform expectations by mid-single digits. While the 2024 estimated gross gaming revenue (GGR) for the Strip is expected to moderate, non-gaming growth is predicted to continue, bolstered by sports events, entertainment, and a packed convention schedule.
The upcoming Super Bowl, featuring the San Francisco 49ers against the Kansas City Chiefs, is expected to draw significant drive-in traffic and bolster demand. Despite some hotels on the Strip still having rooms available, the high average ticket price for the Super Bowl, reported to be over $10,000, indicates a sustained spending willingness among high-end luxury consumers.
Macquarie noted, "We believe this highlights that the high-end luxury consumer continues to have a willingness to spend, while lower income consumers may be feeling the pinch."
The firm's analysis suggests that businesses with exposure to the luxury market segment are poised to benefit from the robust consumer spending patterns associated with major events like the Super Bowl.
InvestingPro Insights
Amidst the anticipation of Super Bowl LVIII's positive impact on Las Vegas Strip revenue, Wynn Resorts (NASDAQ:WYNN) stands out with noteworthy financial metrics and analyst expectations. The company's market capitalization, currently at $10.89 billion, reflects its significant presence in the industry. The expected growth in net income and sales this year is a strong indicator of Wynn Resorts' potential to capitalize on the increased activity in Las Vegas, as highlighted by an InvestingPro Tip that underscores analysts' anticipation of sales growth in the current year.
Wynn Resorts' gross profit margin for the last twelve months as of Q3 2023 was an impressive 63.77%, pointing to efficient operations and strong pricing power. This aligns with another InvestingPro Tip that emphasizes the company's impressive gross profit margins. Moreover, with a revenue growth of 50.14% during the same period, Wynn Resorts demonstrates a robust capacity for increasing its top line, which is critical in the context of the bustling activity expected from the Super Bowl and other events in Las Vegas.
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