Hong Kong stock movement: Morgan Stanley downgraded its rating, MGM CHINA plummeted 15.08% due to an increase in licensing fees

Hong Kong Stock Movement MGM China fell 15.08%. Based on recent key news: On December 29, Morgan Stanley downgraded MGM China's rating due to the increase in license fees affecting profit expectations. MGM China will pay higher license fees to its parent company starting in 2026, with an expected 5% decline in EBITDA and a 220 basis point contraction in profit margins in 2026. Source: Morgan Stanley report On December 29, Morgan Stanley predicted that MGM China's brand usage fees will reach HKD 1.2 billion in 2026, an increase of HKD 600 million compared to 2025. The proportion of brand usage fees to EBITDA will rise to 15.2%, impacting profitability. Source: Economic Information Daily On December 29, Morgan Stanley maintained a constructive view on Macau gaming stocks, but MGM China faces challenges due to cost pressures. Although the industry fundamentals are supportive, rising costs affect stock performance. Source: Opinion Network Macau gaming industry faces cost pressures, impacting profitability. Stocks with High Trading Volume in the Industry Galaxy Entertainment fell 2.67%. Based on recent key news: On December 29, Morgan Stanley upgraded Galaxy Entertainment's rating to "Overweight," raising the target price to HKD 44. Due to the lower proportion of license fee payments, higher profit margins, and increased market share, the stock price performance benefited from this. On December 29, Morgan Stanley's report pointed out that changes in license fees in the Macau gaming industry affect the EBITDA forecasts of related companies. Galaxy Entertainment, due to its lower proportion of license fee payments, has become a preferred choice in the industry, positively impacting its stock price. On December 29, Morgan Stanley predicted that Galaxy Entertainment will achieve higher profit margins, as it is the only net cash company in Macau, with increased dividends and hotel capacity, driving its stock price performance. Changes in license fees in the Macau gaming industry affect stock prices. Sands China fell 3.65%. Based on recent key news: On December 29, there were significant signs of capital inflow into Sands China, with large orders appearing multiple times during the day, driving the stock price upward. As policies for Macau's tourism and gaming industry continue to be favorable, operational expectations for Sands China are gradually improving, with market traffic and gaming revenue steadily recovering, and foreign institutions beginning to gradually increase their positions. The market reflects rapid movements of short-term speculative funds, which can easily lead to volatility when encountering sector differentiation or index instability. The options trading volume also showed a significant increase yesterday, indicating that capital speculation remains intense. Source: Zhitong Finance Favorable policies for Macau's gaming industry, significant capital inflow. Wynn Macau fell 3.85%. Based on recent news: On December 29, Morgan Stanley's report indicated that Wynn Macau's brand usage fees account for a high proportion of the company's EBITDA, reaching 14.1%, which contrasts with the increase in MGM China's brand usage fees, leading to market concerns about Wynn Macau's profitability and impacting its stock price decline. On December 29, the report also mentioned that non-gaming expenditures and royalty leakage could lead to lower valuation multiples for some companies, further exacerbating negative sentiment among investors towards Wynn Macau The recent market outlook for the Macau gaming sector remains positive overall, but financial pressures on individual companies have led to stock price fluctuations. The Macau gaming industry is facing brand fee pressures. Stocks ranked at the top of the industry by market capitalization Galaxy Entertainment Group, up 0.85%, with a market capitalization of HKD 21 billion, has no significant news recently. The trading is active, and the capital flow is evident. Considering the sector and industry trends, this stock shows significant volatility, and the specific reasons need further observation