Macau casino stocks could see significant upside in 2025 despite their underwhelming performance in 2024, according to Stifel analyst Steven Wiecyznski. The current market setup appears favorable for Macau-focused gaming companies, even though these stocks have underperformed since the pandemic.

Macau's gaming sector posted $28.3 billion in gross gaming revenue (GGR) for 2024, representing a 24% year-over-year increase. However, this growth didn't translate to stock performance, with major players like Las Vegas Sands (LVS) gaining just 4% and Wynn Resorts (WYNN) declining by 5% in 2024.

Wynn Resorts could emerge as a standout performer in 2025, largely due to its premium mass market focus, which makes it less vulnerable to China's macroeconomic pressures compared to competitors like Las Vegas Sands, which relies more heavily on mass market visitors.

Key factors supporting the positive outlook include:

• Current market prices adequately reflect China macro pressures
• Macau's 2024 GGR reached 80% of pre-pandemic levels, suggesting room for growth
• Projected Q1 2025 growth of 7-9% year-over-year
• Expected Q2 2025 growth of 8-12%
• Anticipated full-year 2025 GGR growth between 4-10% over 2024

While modeling near-term performance remains challenging due to government stimulus uncertainties, analysts believe consensus estimates for 2025 could prove conservative, making current valuations particularly attractive for investors.

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