Wynn Resorts (WYNN) Benefits From Strong Non-Gaming Revenues
Wynn Resorts, Limited WYNN together with its subsidiaries, is a leading developer, owner and operator of casino resorts. The company owns and operates casino hotel resort properties in Las Vegas, and in Macau Special Administrative Region of the People's Republic of China.
The company posted strong fourth-quarter 2017 results with both earnings and revenues surpassing the Zacks Consensus Estimate.
In fact, it has beaten the consensus mark in each of the trailing four quarters, delivering an average positive surprise of 22.43%. In the past 30 days, the Zacks Consensus Estimate for the first quarter of 2018 has increased from $1.56 to $1.78.
Shares of Wynn Resorts have gained 75.1% in the past year, significantly outperforming the industry’s 41.4% rally.
Growing Non-Gaming Revenues in Macau and Las Vegas
Wynn continues to benefit from its increased focus on boosting non-gaming revenues. In the last reported quarter, Non-casino revenues, before promotional allowances from Wynn Macau and Wynn Palace (Macau operations) were up a respective 44.7% and 5.5% from the year-ago quarter.
Given the decent visitation pattern in Macau, infrastructure development and government’s efforts to boost tourism in Macau, non-gaming sources will continue to boost revenues, going forward.
In the last reported quarter, total non-casino revenues, before promotional allowances in Las Vegas, increased 5.8% year over year to $275.2 million. The growth appears to have been driven by increase in demand for the company’s remodeled rooms at its properties and the baccarat pit.
Wynn Resorts, Limited Revenue (TTM)
Wynn Resorts, Limited Revenue (TTM) | Wynn Resorts, Limited Quote
Growth Prospects Bright
The company’s full-scale integrated resort in Cotai, Macau is poised to witness increased visits from tourists and leisure gamblers over the long term, which should fortify the company’s position in the Cotai strip. Notably, such projects are expected to draw business and leisure travelers, and provide a solid platform for growth. In fact, building resorts in Asia should help the company capitalize on the strong consumer spending trend in the region.
As far as Las Vegas in concerned, tourism has not yet reached the pre-recession level, but it is on its way to recovery. The number of visits has been increasing every year. With the improving job scenario and stabilizing gas prices, consumer spending environment in the domestic markets is picking up. Thus, revenues are likely to grow, going forward.
Moreover, the company’s casino resort, expected to open in Massachusetts in 2019, will strengthen its presence in the United States. Further, the company plans to start building Wynn Paradise Park by early 2018, taking over a footprint that includes the Wynn Golf Club comprising restaurants, hotels and other entertainment options.
Zacks Rank and Stocks to Consider
Wynn Resorts sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Some other top-ranked stocks in the same space include Las Vegas Sands LVS, Boyd Gaming Corporation BYD and Melco Resorts & Entertainment MLCO, each carrying a Zacks Rank #2 (Buy).
Las Vegas Sands, Boyd and Melco’s 2018 earnings are projected to grow 9.5%, 31.2% and 19.8%, respectively.
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