Las Vegas Sands shares have been in a slump, but one options trader thinks the stock is about to turn around. Mike Khouw of CNBC’s ‘Options Action’ says the casino operator could be poised to ‘catch a heater’ — a betting term for when a table goes from cold to hot.
In a note, Khouw points out that while the company is named after the Nevada gaming hub, its fortunes have largely been tied to Asia, specifically Macau, over the past decade. The high-roller VIP segment that once dominated headlines collapsed after Macau banned junket-extended credit in the fourth quarter of 2021. Margins on those VIP players were often thinner due to commissions, perks, and low-edge games like baccarat.
Meanwhile, Sands is exploring new development opportunities in Texas, the UAE, Thailand, and Japan. Khouw says any one of those markets could ‘meaningfully move the needle.’
Cheap stock, cheap options
According to Khouw, the shares trade at about 14 times forward earnings, a multiple based only on Macau and Singapore operations. That valuation sits at the lower end of the company’s historical range, barely above the 10-year low of roughly 13 times.
Management’s confidence is reflected in capital returns: the dividend has been reinstated, and about $6 billion remains on the share buyback authorization — roughly 20% of the current market cap. Khouw notes that once the company starts putting that buyback to work, it could create a strong tailwind for the stock.
Options prices also look cheap. One-month implied volatility is around 28%, versus a five-year average of approximately 39% and a five-year low of 24%. Khouw calls this ‘cheap optionality’ — a key factor given the potential upside from new market development.
Technical signs of a reversal
The stock has fallen more than 30% since late November of last year, which Khouw says is a big reason it looks cheap. But seasoned traders look for inflection points, and he believes LVS may have found one. The 20-day moving average has turned up and appears to be crossing above the 50-day, and the shares have outperformed the S&P 500 since the beginning of the second half of 2026.
For those looking to call a rebound early, Khouw suggests considering call options. He highlights the November $50 strike calls, trading at just over $2 per contract, or about 4% of the current stock price. That trade would capture earnings, the midterm elections, and the potential for a bearish-to-bullish reversal.
Disclosures: Tidal owns/holds all the securities mentioned in this article.
Source: www.cnbc.com — https://www.cnbc.com/2026/08/26/las-vegas-sands-shares-are-about-to-catch-a-heater-says-mike-khouw.html
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