Global Political Challenges Affect Gaming Stocks
The U.S. election has gotten most of the domestic headlines, but it's a leadership change in China that will most impact gaming stocks going forward. Las Vegas Sands (NYS: LVS) , Wynn Resorts (NAS: WYNN) , Melco Crown (NAS: MPEL) , and even MGM Resorts (NYS: MGM) all count on Macau and by extension China's VIP gamblers for a large portion of their business. But what most people don't know is that much of the VIP business is driven by junkets, which provide a way for wealthy Chinese to get money out of China. If China's new government tries to crack down on the flow of funds out of China through Macau or other corrupt practices that are often tied to Macau, it could affect gaming revenue going forward.
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The article Global Political Challenges Affect Gaming Stocks originally appeared on Fool.com.Fool contributor Travis Hoium manages an account that owns shares of Melco Crown Entertainment and Wynn Resorts, Limited. You can follow Travis on Twitter at @FlushDrawFool, check out his personal stock holdings or follow his CAPS picks at TMFFlushDraw. The Motley Fool has no positions in the stocks mentioned above. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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