Run rate recovered only slightly w-o-w, partly dragged by luck: The first 10daysof September yielded MOP6.8bn in gross gaming revenue (GGR). Average daily runrate (ADR) came in at MOP680m/day despite encompassing two weekends,rebounding only mildly from MOP661m/day the week before. The number tracks 7%below the August run rate. Seasonality apart, a weaker win rate played a role in them-o-m slowdown. Based on our estimate, luck tracks 2.7% vs theoretical of 2.85%.The aftermath of the typhoon, despite the resumption of group tours to Macau, mayhave dragged on revenue growth, too. By segment, mass GGR is c5-6% lower whileVIP is down c10% m-o-m. By operator, MGM and SJM appear to have gained sharefrom Melco and Sands, based on our observations.    September tracks +10to 13% y-o-y: The summer holiday is behind us and historicallyGGR tends to trend slower ahead of the October Golden Week, especially given thisyear’s Mid-Autumn festival has shifted from September to October. We expect fullmonthGGR to come in at MOP20.2-20.8bn, translating into MOP670-700m/day for therest of the month. This implies full 3Q17GGR at +5-6% q-o-q, or +20-21% y-o-y.    Stick to quality names: August/September 2016marked two new openings,alleviating comps, making it tougher into the rest of 2017. But we think fundamentalsremain intact. A potentially strong Golden Week, coupled with the Mid-AutumnFestival could be near-term catalysts to provide valuation support to Macau names'share prices. Among the operators, we continue to prefer Galaxy (27HK, HKD51.5,Buy) for its defensive operations and undemanding valuation. We also like MelcoResorts (MLCO US, USD22.8, Buy) as we expect loss in market share to stabilise,and its valuation is attractive.

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