Macau casino operator SJM spikes 8pc as Goldman upgrades target price ahead of hotel opening

SJM Holdings, the Macau gaming operator owned by the family of casino mogul Stanley Ho, posted its biggest intra-day gain in over six years after US broker Goldman Sachs raised its target price to reflect the opening of its new flagship property, the Grand Lisboa Palace in mid-2019.

SJM surged to HK$11.60, up 11.8 per cent marking its biggest intra-day gain since October 2011 before closing at HK$11.26 on turnover of HK$1.13 billion.

Goldman Sachs raised SJM’s target price to HK$$12.7 from HK$12, as it expects the company to benefit from the industry’s gross gaming revenue growth in the second quarter and improved Ebitda in the past two quarters.

The Grand Lisboa Palace, the first integrated resort being developed by SJM on Cotai, the city’s new gambling and tourism area, will feature 2,000 hotel rooms and suites, facilities for meetings and conferences, shopping, dining and entertainment, and a casino.

HSBC said it remained constructive on the sector because of the strength in the mass market, driven by new capacity and infrastructure upgrades, which could potentially drive further re-ratings.

Melco Resorts & Entertainment recently announced that its new flagship hotel, Morpheus, was on target to open on June 15, located at the City of Dreams.