Analysts: Galaxy’s rising dividends signal a positive outlook

Analysts responded positively after Galaxy Entertainment Group Ltd (Galaxy) posted strong results for the first half of 2025.

For the six months ending June 30, Galaxy’s profit rose by 19.4% to HKD5.24 billion. Meanwhile, net revenue increased by 8% to HKD23.2 billion, and adjusted EBITDA grew 14% to HKD6.9 billion.

The company’s performance demonstrated growing confidence in its market position and ability to deliver returns to shareholders.

Senior analyst Vitaly Umansky of Seaport Research Partners described Galaxy’s dividend announcements as “significant,” highlighting the steady upward trend.

“Galaxy previously announced a final dividend of HKD0.50 to be paid in June, following dividends of HKD0.80 in 2024. It has now announced a HKD0.70 interim dividend payable in October,” said Umansky. In a Tuesday memo, the analyst indicated strong potential for dividends to increase further as the company’s operating cash flow strengthens.

JP Morgan analysts underscored management’s commitment to sustainable shareholder returns, observing comfort with raising the payout ratio to around 60%. Analysts DS Kim and Selina Li view this figure as a baseline rather than a cap, anticipating further increases as capital spending related to the Phase 4 expansion of Galaxy Macau winds down in 2027 and 2028.

Jefferies Hong Kong Ltd analysts also confirmed this trajectory, indicating a payout ratio increase from 30% in 1H 2023 to 58% in 1H 2025.

Jefferies also forecasts a full-year capital expenditure of roughly HKD7 billion, with less than HKD4 billion expected in the second half.

Market share gains are another highlight. Galaxy secured a 20.2% share in Q2 2025 — its highest since before the pandemic — driven by mass-market and VIP segments growth.

Galaxy management confirmed that the business environment has remained stable this year despite growing competition. This stability is supported by a 20% quarter-on-quarter rise in VIP gaming volume and increased incentives for VIP clients.

The luxury Capella hotel, which began preview operations in May, has also contributed significantly to this VIP growth.

Citigroup analysts previously attributed the 25%–30% increase in VIP volumes in May to the opening of the Capella hotel at Galaxy Macau.