Wynn Resorts, Limited is a developer, owner and operator of destination casino resorts that integrate accommodations and a range of amenities, including dining outlets, retail offerings, entertainment theaters and meeting complexes. There are 450+ tables and 700+ slot machines in Macau with another 200+ tables and 1,850 slots in Vegas. Plus there's the new outfit coming in Everett, MA!
Recent financials
The figures say it all :(
Metric
2015A
2014A
2013A
2012A
2011A
Revenue
$4.1bn
$5.4bn
$5.6bn
$5.2bn
$5.3bn
EPS
$1.92
$7.18
$7.17
$4.82
$4.88
But if you want to know why? Macau saw sales down 35% in 2015 (to $2.5bn) and Vegas was off a little (down 2% to $1.6bn).
The decline is primarily due to the continued weak gaming environment affecting our Macau Operations, which experienced a year-over-year decrease in casino revenues of 35.5% from $3,586.8 million to $2,312.9 million. Our VIP gaming operations drove the Macau Operations casino revenue reduction, with $57.92 billion in VIP turnover for the year ended December 31, 2015, compared to $108.08 billion for the same period of 2014.
Is that the canary in the coal mine for China? Or just that the wealthy are embracing the new president's austere views?
Competition
Let's focus on Macau first
In addition to Wynn Macau SA, each of Sociedade de Jogos de Macau ("SJM") and Galaxy Entertainment Group Limited are primary concessionaires with Sands China Ltd., Melco Crown and MGM China Holdings Limited operating under subconcessions. There is no limit to the number of casinos each concessionaire or subconcessionaire is permitted to operate, but each facility is subject to government approval. Currently, there are 36 operating casinos in Macau.
Oh dear. Sounds like there's overcapacity...
As of December 31, 2015, there were 32,200 hotel rooms, 5,957 table games and 14,578 slot machines in Macau, compared to 12,978 hotel rooms, 2,762 table games and 6,546 slot machines as of December 31, 2006.
So a 2 to 3 fold increase in 10 years. Now over in Vegas things are decidedly rosier!
During 2015, the average daily room rate increased 2.7% and visitation increased 2.9% to 42.3 million visitors compared to 2014. In addition, Las Vegas Strip resorts experienced 2015 year-over-year increases of 0.6% and 3.3% in occupancy and revenue per available room, respectively.
Companies
Latest Sales
Operating Profit
Return on Equity
Wynn Resorts, Limited
$3,999M
24%
N/A
Las Vegas Sands Corp.
$11,122M
32%
24%
MGM Resorts International
$8,952M
22%
-3%
Red Rock Resorts Inc
$1,382M
34%
33%
Penn National Gaming, Inc
$2,999M
29%
N/A
Churchill Downs, Inc.
$1,279M
21%
12%
So margins are good, but not great... and returns are N/A... why? Because WYNN's been so good at returning capital that there really is no equity left to measure returns on equity. Nice!
Cash / Debt?
Wynn Resorts, Limited has $7,345M of net debt. That is 7.8x its latest operating profit. Ooops. So in effect the aggressive pay-outs come with a catch.
Metric
2015A
2014A
2013A
2012A
2011A
EPS
$1.92
$7.18
$7.17
$4.82
$4.88
Cash distribution per share
$3.00
$6.26
$7.00
$9.50
$6.50
Wall Street thinks?
The professionals on Wall Street have a $102.54 for Wynn Resorts, Limited and their recommendation to clients is Hold. That implies an downside of 6% to their target.
Valuation
At 28x earnings it's hard to disagree with the brokers. Though, am a little surprised they see such good long-term growth prospects. How can I justify WYNN when RRR is on 18x and PENN on 13x?
Wynn Resorts, Limited is forecast to pay a dividend of $2.16 per share, compared with a historic dividend of $2.00 per share. That is a 8% growth. The forecast dividend of $2.16 compares to a forecast EPS of $3.88.
Catalysts
After the horror of 2015, 2016's got back on track and the business is stabilising and EPS is recovering. In the last 3 months the stock price has moved by 8% that compares with a change in the earnings forecasts of +6%. Though on a 1 year view the stock's up 60% with earnings up 20%. On the management team's latest call with Wall Street brokers they highlighted that Macau's improving and that they'll keep up returning capital to shareholder. They even spoke of the new casino near Boston, finally getting it's construction permits. But the one thing they didn't do was talk guidance. Seems it's just not something they do! I fear the easy money's been made on WYNN the last 12 months, as folks that believe the earnings would come back got rewarded. So, how do the chips fall from here? Is the next big event, the launch of Boston? Or will we have to bear the capex cost before we see the benefit? What's your gamble? View the archive of Stock a Day posts at its subreddit stockaday. And please send us suggestions on what you'd like us to research next! If you'd like to join the writing team please get in touch. Our writing template is available here if you'd like to use it to pen your own stockAday type posts :). Disclosure: I have no positions in any stocks mentioned. However I may initiate a position within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article. Reddit, moderators, and the author do not advise making investment decisions based on discussion in these posts. Analysis is not subject to validation and users take action at their own risk. Author notes: u/shane_stockflare works at a financial website, Stockflare, and is a Chartered Financial Analyst. Previously he worked at Credit Suisse, where he was an equity research analyst covering tech stocks and at Citigroup where he was an investment banker.
Wynn Resorts, Limited is a developer, owner and operator of destination casino resorts that integrate accommodations and a range of amenities, including dining outlets, retail offerings, entertainment theaters and meeting complexes. There are 450+ tables and 700+ slot machines in Macau with another 200+ tables and 1,850 slots in Vegas. Plus there's the new outfit coming in Everett, MA!
Recent financials
The figures say it all :(
Metric
2015A
2014A
2013A
2012A
2011A
Revenue
$4.1bn
$5.4bn
$5.6bn
$5.2bn
$5.3bn
EPS
$1.92
$7.18
$7.17
$4.82
$4.88
But if you want to know why? Macau saw sales down 35% in 2015 (to $2.5bn) and Vegas was off a little (down 2% to $1.6bn).
The decline is primarily due to the continued weak gaming environment affecting our Macau Operations, which experienced a year-over-year decrease in casino revenues of 35.5% from $3,586.8 million to $2,312.9 million. Our VIP gaming operations drove the Macau Operations casino revenue reduction, with $57.92 billion in VIP turnover for the year ended December 31, 2015, compared to $108.08 billion for the same period of 2014.
Is that the canary in the coal mine for China? Or just that the wealthy are embracing the new president's austere views?
Competition
Let's focus on Macau first
In addition to Wynn Macau SA, each of Sociedade de Jogos de Macau ("SJM") and Galaxy Entertainment Group Limited are primary concessionaires with Sands China Ltd., Melco Crown and MGM China Holdings Limited operating under subconcessions. There is no limit to the number of casinos each concessionaire or subconcessionaire is permitted to operate, but each facility is subject to government approval. Currently, there are 36 operating casinos in Macau.
Oh dear. Sounds like there's overcapacity...
As of December 31, 2015, there were 32,200 hotel rooms, 5,957 table games and 14,578 slot machines in Macau, compared to 12,978 hotel rooms, 2,762 table games and 6,546 slot machines as of December 31, 2006.
So a 2 to 3 fold increase in 10 years. Now over in Vegas things are decidedly rosier!
During 2015, the average daily room rate increased 2.7% and visitation increased 2.9% to 42.3 million visitors compared to 2014. In addition, Las Vegas Strip resorts experienced 2015 year-over-year increases of 0.6% and 3.3% in occupancy and revenue per available room, respectively.
Companies
Latest Sales
Operating Profit
Return on Equity
Wynn Resorts, Limited
$3,999M
24%
N/A
Las Vegas Sands Corp.
$11,122M
32%
24%
MGM Resorts International
$8,952M
22%
-3%
Red Rock Resorts Inc
$1,382M
34%
33%
Penn National Gaming, Inc
$2,999M
29%
N/A
Churchill Downs, Inc.
$1,279M
21%
12%
So margins are good, but not great... and returns are N/A... why? Because WYNN's been so good at returning capital that there really is no equity left to measure returns on equity. Nice!
Cash / Debt?
Wynn Resorts, Limited has $7,345M of net debt. That is 7.8x its latest operating profit. Ooops. So in effect the aggressive pay-outs come with a catch.
Metric
2015A
2014A
2013A
2012A
2011A
EPS
$1.92
$7.18
$7.17
$4.82
$4.88
Cash distribution per share
$3.00
$6.26
$7.00
$9.50
$6.50
Wall Street thinks?
The professionals on Wall Street have a $102.54 for Wynn Resorts, Limited and their recommendation to clients is Hold. That implies an downside of 6% to their target.
Valuation
At 28x earnings it's hard to disagree with the brokers. Though, am a little surprised they see such good long-term growth prospects. How can I justify WYNN when RRR is on 18x and PENN on 13x?
Wynn Resorts, Limited is forecast to pay a dividend of $2.16 per share, compared with a historic dividend of $2.00 per share. That is a 8% growth. The forecast dividend of $2.16 compares to a forecast EPS of $3.88.
Catalysts
After the horror of 2015, 2016's got back on track and the business is stabilising and EPS is recovering. In the last 3 months the stock price has moved by 8% that compares with a change in the earnings forecasts of +6%. Though on a 1 year view the stock's up 60% with earnings up 20%. On the management team's latest call with Wall Street brokers they highlighted that Macau's improving and that they'll keep up returning capital to shareholder. They even spoke of the new casino near Boston, finally getting it's construction permits. But the one thing they didn't do was talk guidance. Seems it's just not something they do! I fear the easy money's been made on WYNN the last 12 months, as folks that believe the earnings would come back got rewarded. So, how do the chips fall from here? Is the next big event, the launch of Boston? Or will we have to bear the capex cost before we see the benefit? What's your gamble? View the archive of Stock a Day posts at its subreddit stockaday. And please send us suggestions on what you'd like us to research next! If you'd like to join the writing team please get in touch. Our writing template is available here if you'd like to use it to pen your own stockAday type posts :). Disclosure: I have no positions in any stocks mentioned. However I may initiate a position within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article. Reddit, moderators, and the author do not advise making investment decisions based on discussion in these posts. Analysis is not subject to validation and users take action at their own risk. Author notes: u/shane_stockflare works at a financial website, Stockflare, and is a Chartered Financial Analyst. Previously he worked at Credit Suisse, where he was an equity research analyst covering tech stocks and at Citigroup where he was an investment banker.
The Massachusetts Gaming Commission awarded Wynn Resorts and Everett, Ma a Greater Boston region (Region A) casino license. This may be good news for Everette but what about Medford? The $1.6 billion plan will clean the land then crown it with five-star, 500+ room luxury casino (from the looks of it aesthetically challenged).At first Traffic flow through Sullivan Square is expected to be most severely effected but permanent, increased traffic flow in predicted throughout the area once the casino is fully operational. Several nearby communities will benefit financially with annual payments to help offset the Casino's impact on traffic as well as general quality of life. Medford's agreement with Wynn includes a yearly payment of $1 million to help mitigate Medford’s public safety concerns, creates a community fund, creates a cultural fund for Chevalier Auditorium, improves water safety on the Mystic River and funds aesthetic upgrades for businesses. In addition, the agreement recognizes that Wellington Station will become a transportation hub for employees, vendors and patrons of a casino for which Wynn will support without limitation, safety upgrades and improved lighting, signage and beautification efforts in Wellington and the surrounding area. In addition Wynn has agreed to: Pay up to $1.5 million for a 25% concept design for Wellington Circle. Cooperate with efforts by Medford to seek funding from the Transportation Infrastructure and Development Fund for a permanent solution at Wellington Circle. Provide $1 million to address improvements at 12 traffic intersections in accordance with MEPA. Provide $50,000 towards the Krystle Campbell Peace Garden and an additional $200,000 following the acceptance by Wynn of a license. Purchase $25,000 in gift certificates purchased from Medford businesses to be used in Wynn’s Loyalty Program. Provide up to $10 million a year in a good faith effort to utilize local business and supplies. Work to give preferential treatment to qualified Medford residents for contracting, subcontracting and servicing opportunities in the development and construction of the Project. Advertise and hold at least one event for Medford residents and give preference to properly qualified residents. Review and consider remediation plans for the removal of water chestnuts on the Mystic River as part of its environmental program. /MedfordMass wants to know: What do you think of the casino? Do you support the deal the Mayor worked out for the city? Do you like the Casino's overall design?
Not sure if anyone here is familiar with the Wynn casino coming to Everett. It's still a good 3 years off. I was hoping to find confirmation that there will be a poker room, and that there won't be any sort of crazy laws capping the bets (Colorado has this, it pretty much forces you to play limit). Anyone know any relevant details?
Experience the ultimate in cozy indulgence with an in-room dining room service experience prepared by the chefs at Wynn and Encore. From blueberry stuffed pancakes at sunrise to a midnight craving for sliders and fries, our 24 hour team delivers the tastes of the world right to the comforts of your own room. So what will Wynn Resorts Everett look like? The plan will convert the 26-acre former chemical plant site along the Mystic River into a five-star luxury resort, with a 365-foot glasslike hotel tower soaring above the riverfront and offering 500 luxurious rooms. The casino floor will sport 3,242 slot machines and 168 table games. Join now for instant access to exclusive offers and up to a 30% savings on any room and up to 20% savings on Tower Suites—with no blackout dates. The Vegas-ified version of a signature local dish is just one of many ostentatious offerings at Wynn Resorts' new venue in Everett. There's also a $15,000 hotel suite and a carousel adorned with Encore Boston Harbor Rooms & Suites At Encore Boston Harbor, every room and suite is designed for a serene and stylish retreat. Come see why Wynn Resorts holds more Forbes Travel Guide Five-Star awards than any other independent hotel company in the world. $2.6 billion -- Wynn Resorts says it spent an estimated $2.6 billion constructing the casino complex. Some more numbers: Encore has 671 hotel rooms, 14 bars and restaurants (and a 24-hour Dunkin New Wynn Everett Looks Like Old Wynn Vegas. Posted on: February 1, 2015, 12:52h. Last updated on: January 31, 2015, 01:55h. Welcome to Encore Boston Harbor Resort. Luxury hotel rooms & suites, fine dining, casino, event center, shopping. (857) 770-7000
About Press Copyright Contact us Creators Advertise Developers Terms Privacy Policy & Safety How YouTube works Test new features Press Copyright Contact us Creators ... 2017 January tour of the Wynn Encore resort in Las Vegas. .Wynn Las Vegas, often referred to as simply the Wynn, is a luxury resort and casino located on the Las Vegas Strip in Paradise, Nevada. The US$2.7 billion r... Contessa Brewer takes you inside Wynn's $2.6B Encore Boston Harbor.
