Posted on: June 20, 2023, 05:09h.
Last updated on: June 20, 2023, 06:57h.
Mexico and Canada, the southern and northern neighbors of the US, accounted for more than half of the international visits to Las Vegas in 2022.
Recently released data from the Las Vegas Convention and Visitors Authority (LVCVA) indicate 3.4 million tourists from outside the US traveled to the US casino hub last year. Mexico and Canada combined for 1.87 million of those arrivals, with the UK placing third with 482,380 visitors.
Beyond proximity, Vegas enthusiasm on the part of Canadian and Mexican tourists is understandable. The latter doesn’t have traditional US-style casinos and while Canada has its share of gaming venues, they aren’t comparable to what’s found in Sin City. The same is true of the UK.
Last year represented the third consecutive year in which Mexico led all countries in terms of visits to Las Vegas. Canada held that spot from 2010 to 2019.
Looking at Vegas Visitation Trends
Due in large part to proximity, Mexico’s economy — Latin America’s second-largest — often takes its cues from the US. That’s to say, if the US skirts a recession, Mexico could accomplish the same feat, potentially supporting consistent Vegas visitation from that country.
Las Vegas is also accessible from major Mexican cities, as several airlines offer nonstop flights to Sin City from Mexico City, Guadalajara, and Monterrey. It’s possible Vegas trips from other parts of Latin America will increase going forward. Colombia-based Avianca Airlines will commence an El Salvador to Las Vegas flight next month. That’s expected to expand access to the US gaming hub for tourists from across South America.
On a related note, visits to Las Vegas among UK residents could soon perk up as Virgin Atlantic is slated to restart nonstop service from Manchester to Las Vegas at some point over the next several months. That’s potentially significant because the population of the greater Manchester area is north of 2.7 million.
The LVCVA data indicate that Australia and Germany rounded out the top five countries for 2022 arrivals to Las Vegas, combining for 8.2% of the total visits.
China still has a way to go to reclaim its status as a major contributor to Las Vegas travel. Due in part to coronavirus restrictions, Chinese nationals still haven’t flocked back to the US in droves, and the pandemic forced some Asian carriers to scrap China to Vegas flights, which haven’t been restored.
Predictable Beneficiaries of International Visits
While visitors to Las Vegas from other countries are apt to venture to different parts of the city, the probabilities are high they’re staying on the Strip. That’s a plus for MGM Resorts International (NYSE: MGM) and Caesars Entertainment (NASDAQ: CZR), the two largest Strip operators.
Las Vegas is a primary driver of both companies’ equity performance. In a note to clients on Tuesday, Jefferies analyst David Katz highlighted Caesars’ Vegas correlations.
“We now expect the Las Vegas segment to generate $1.126 billion of revenue and $522.6 million of adjusted earnings before interest, taxes, depreciation, amortization, and restructuring or rent costs (EBITDAR) vs. $1.090 billion and $505 million prior,” wrote Katz.
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