Citi reiterates Buy rating on Galaxy Entertainment stock, sees strong EBITDA growth

Citi has reiterated a Buy rating on Galaxy Entertainment Group (HK:27) with a HK$51.50 price target, projecting an 11% year-over-year EBITDA increase for Q2 2025. This significantly outperforms the broader Macau casino industry's anticipated 3% growth for the same period. Citi analyst George Choi believes this superior EBITDA performance, particularly ahead of the company's mid-August earnings announcement, is poised to drive positive share price momentum.

Analysis

Citigroup has reaffirmed its 'Buy' rating for Galaxy Entertainment Group (HK:27) while maintaining a price target of HK$51.50. The investment bank's positive outlook is primarily driven by a significant projected outperformance in the second quarter of 2025. According to Citi's forecast, Galaxy Entertainment's EBITDA is expected to grow 11% year-over-year, a rate that substantially exceeds the anticipated 3% year-over-year EBITDA increase for the broader Macau casino industry during the same period. Citi analyst George Choi suggests this superior fundamental growth profile will likely serve as a key catalyst for positive share price momentum. The timing of this potential re-rating is linked to the company's upcoming earnings announcement, which is anticipated in mid-August.

Key Decisions for Investors

• Investors with a bullish view on the Macau gaming sector could consider Galaxy Entertainment as a potential outperformer, given its projected 11% EBITDA growth significantly exceeds the industry's 3% forecast for Q2 2025.
• The upcoming mid-August earnings announcement should be monitored closely as a key short-term catalyst that could validate Citi's thesis and drive share price performance.
• Consider evaluating Galaxy's current share price relative to Citi's HK$51.50 price target to assess the potential upside implied by the bank's analysis.