LVS likely to see more gains - Forbes

Gaming stocks have been moving higher since China’s Macau gambling district posted its first year-over-year rise in revenue in two years last month. Month-to-date, the Market Vectors Gaming ETF is up nearly 7% — and fresh off a Sept. 22 annual high. What’s more, of the nine stocks we track under the gaming umbrella, 78% are trading above their 80-day moving average, boasting an average year-to-date return of 11.8%.

However, there’s still plenty of skepticism surrounding the outperforming sector — which could make it a prime time for options traders to roll the contrarian dice on casino stocks.

One name of particular interest is Las Vegas Sands LVS +1.04%. The stock has been gaining ground with its sector peers this month, tacking on 13.9%. Plus, LVS notched a 52-week peak on Sept. 16.

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While this only highlights LVS’ longer-term technical tenacity — the shares have soared 30% in 2016 — it is now on track to close north of its 30-month moving average for the first time since November 2014

This trendline could play a key role in the security’s momentum, considering it previously served as support in late 2012 and mid-2013

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Not everyone has bought into Las Vegas Sands’ uptrend, though. In the options pits, the stock sports a top-heavy Schaeffer’s put/call open interest ratio (SOIR) of 1.19. Not only does this show that puts outweigh calls among options expiring in three months or less, it also ranks in the elevated 84th annual percentile.

In other words, short-term speculators are more put-heavy than usual toward LVS. This lofty accumulation of puts could help buoy the shares in the near term, as the hedges related to these bets unwind ahead of expiration.

Outside of the options pits, short sellers have been upping the bearish ante with a quickness. Specifically, short interest jumped 14.3% in the two most recent reporting periods, and is now docked at levels not seen since early February. While it’s impressive that LVS was able to notch a fresh 52-week peak under such intense selling pressure — speaking volumes to its underlying strength — this also suggests that there is sideline cash available to help fuel the stock’s fire.

LVS could find itself on the receiving end of some bullish brokerage attention, too. Of the 13 analysts covering the shares, nine maintain a “hold” or “strong sell” suggestion. Plus, the average 12-month price target of $53 stands at a discount to present trading levels. Going forward, a round of upgrades and/or price-target hikes could translate into fresh tailwinds for the shares.