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Galaxy Entertainment Group (SEHK:27) Could Be 75% Below Fair Value After Macau Event Win

Simply Wall St · 3d ago

Galaxy Entertainment Group (SEHK:27) is back in focus after Galaxy Macau captured 43% of premium mass wagers during the Women’s Volleyball Nations League Finals Macao 2026, an event the company co organized and sponsored.

See our latest analysis for Galaxy Entertainment Group.

That premium mass result comes as Galaxy Entertainment Group’s share price has climbed over the short term, with a 1 month share price return of 15.07% and a 7 day share price return of 4.54%. However, the year to date share price return is down 13.04% and the 3 year total shareholder return is down 35.35%, suggesting recent momentum is improving against a weaker longer term record.

If events led by Galaxy have you watching the sector more closely, it could be a useful moment to broaden your search and review the 107 top founder-led companies

After Galaxy Entertainment Group’s recent bounce, the share price still sits well below both analyst targets and some intrinsic value estimates. So how wide is that gap in practical terms, and what does the valuation range really suggest next?

Price-to-Earnings of 13.8x: Is it justified?

On the latest figures, Galaxy Entertainment Group trades on a P/E of 13.8x, which screens as good value against the Hong Kong Hospitality industry average of 14.8x but looks expensive versus both its peer average of 12.4x and an estimated fair P/E of 11.1x.

The P/E ratio compares the company’s HK$33.60 share price with its earnings per share. It reflects what investors are currently willing to pay for each dollar of profit. For a business like Galaxy Entertainment Group that earns the majority of its HK$49,294.87m revenue from gaming and entertainment in Macau, this multiple is often used as a quick way to gauge how its earnings are being priced compared with other hospitality stocks.

Against peers, a higher P/E can suggest the market is assigning a premium to the quality or durability of Galaxy Entertainment Group’s earnings, especially given the company reports high quality earnings and net profit margins of 21.7%, up from 20.1% last year. However, the estimated fair P/E of 11.1x is materially lower than the current 13.8x. This is a level the market could move toward if sentiment or expectations around earnings growth, forecast at 7% per year, cools relative to broader Hong Kong market growth expectations.

Compared with the wider Hong Kong Hospitality industry, where the average P/E stands at 14.8x, Galaxy Entertainment Group’s 13.8x multiple is slightly lower. This suggests the stock is not being priced at an industry premium despite its stronger past year earnings growth versus the sector. The tension between trading richer than close peers and the fair P/E estimate, yet slightly below the industry average, gives investors a mixed valuation picture that hinges on how much confidence they place in the current earnings outlook.

Explore the SWS fair ratio for Galaxy Entertainment Group

Result: Price-to-Earnings of 13.8x (OVERVALUED)

However, Galaxy Entertainment Group’s heavy reliance on Macau gaming revenue and the share price’s multi year decline could both challenge any simple upside story from here.

Find out about the key risks to this Galaxy Entertainment Group narrative.

Another view on Galaxy Entertainment Group’s value

While the 13.8x P/E suggests Galaxy Entertainment Group is priced a little rich versus peers and its fair ratio of 11.1x, the SWS DCF model points the other way. With the stock at HK$33.60 against an estimated DCF value of HK$58.87, this method flags it as materially undervalued. Which signal do you think deserves more weight?

Look into how the SWS DCF model arrives at its fair value.

27 Discounted Cash Flow as at Jul 2026
27 Discounted Cash Flow as at Jul 2026

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Next Steps

The mix of potential upside and clear risks around Galaxy Entertainment Group will not be resolved for you by any single metric. Act quickly, review the data for yourself, and weigh the 4 key rewards and 1 important warning sign

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.