Analyst Vitaly Umansky recommends that Melco Resorts & Entertainment sell its underperforming overseas properties to focus on expanding in Macau
A top expert thinks Melco Resorts & Entertainment should think about selling its casino properties in the Philippines and Cyprus. This advice is part of a plan to make the company stronger in important markets, including Macau and Thailand. Vitaly Umansky from Seaport Research Partners shared these thoughts in a recent study of the company’s future.
Analyst Urges Melco to Focus on Macau Growth and Studio City Buyout
Umansky pointed out that Melco’s overseas operations were not doing as well as its Macau properties. The City of Dreams Manila keeps bringing in money, but it is up against more rivals in the Philippine market, which puts a cap on how much it can grow. In the same way, the City of Dreams Mediterranean in Cyprus has not lived up to the expectations because of political issues involving Russia and Israel. Umansky thinks that if Melco got rid of these properties, it could focus its money and efforts on its assets that make more profit.
A major suggestion is to buy out Studio City in Macau where Melco now owns 55%. Buying the rest would give Melco full control of the high-end casino resort and set the stage for a possible merger with its parent company, Melco International Development. Umansky said this could boost how investors feel about the company and create more value for shareholders in the long run.
Melco’s Thai Market Ambitions Could Offset Macau Challenges, Analyst Suggests
Also, Melco has shown interest in joining the Thai market, and the company might take part in a bid for a gaming license once Thailand finalizes casino legalization. The analyst noted that building a big integrated resort in Bangkok, Thailand’s capital, could be tough. However, he highlighted that Melco’s history of teaming up in other places, like Sri Lanka, could help cut down upfront costs. Umansky said Melco could look into smaller markets in Thailand where it might cost less to invest.
Despite selling off some assets, Melco still faces tough competition in its main Macau market. Recent numbers show Melco’s market share dropped a bit, from 14.8% in Q3 2024 to about 14.7% in Q4. Rivals Sands and Galaxy Entertainment are likely to gain ground in 2025, thanks to upgraded properties and new projects.
These factors highlight why Melco needs to trim its portfolio and zero in on chances for big growth. Investors are not too excited about Melco’s shares, yet, but selling some assets and making smart investments could help the company set itself up for steady growth in the cutthroat gaming industry.
