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re: Weekly Stock Market Plays/Thoughts - March/April
Posted on 4/24/17 at 5:54 pm to jkcooper92
Posted on 4/24/17 at 5:54 pm to jkcooper92
quote:
Earnings tomorrow for WYNN. Will it beat estimate? You still long on WYNN?
Im still long, chart looks like its about to break out of a multiyear cup and handle. My take on earnings is this
1. Macau releases numbers every 1st of the month for the entire region and every month in this quarter was a major beat, did they all go to wynn? no there are 35 casinos in the area, but last quarter WYNN got over 50% of the VIP segment and the other 34 hotels got the rest of the business
2. Chinese New Year was this past period, thats the biggest holiday for them, and they love to gamble then.
3. Vegas isn't that big a deal for WYNN overall as its like 1/8th of the business of Macau, but Super Bowl was last quarter
4. We should get updates on the Wynn Plaza which should be opening in october, adding another 100k sq ft of retail leasing at $300/ft and we should be getting an update on the Wynn paradise park, he said he would be going to the board in the 2nd quarter to finalize it all. Also Wynn Boston updates will be nice tomorrow as it should be opening in 12-18 mo.
5. Last Q he said he could double the dividend but didnt bc of the money being needed to get this paradise park going, but who knows they could surprise.
6. Again last Q he said Wynn Palace, the new hotel in Cotai, and probably the nicest casino on earth, he said it was the fastest he had ever seen in all his years to $1m/day in EBITDA, so if it had continued growth could be a monster.
Again the bottom line on WYNN is its a play on EBITDA and that EBITDA has multiple catalysts over the next 24 months to double it from last year and as Wynn Palace ramps up,Wynn Boston comes online,Wynn Plaza comes online, and Paradise park begins construction, the upside is considerable.
I still think $150+ this year barring bad news from the macau region, but the stock has been very strong all year, and I believe I read today it was added to the Nasdaq 100 so now funds have to add a position in it.
I've always said my investing style is investing in visionaries moreso than the companies guys like Steve Wynn,Elon Musk,Mark Zuckerberg,Jeff Bezos, Page/Brin you want your money being invested in brainpower like that. Is wynn due for a pullback? Sure it was $88 on new years and its $115 right now, but it really seems like the Macau region is back to being the monster many thought it was going to be years ago. Lets not forget Japan legalized gaming recently and will be the 2nd largest market on earth when its done and WYNN is vying for one of the handful of licenses they're going to issue and I would be bet that Japan would prefer the high end class of a WYNN property over some mediocre MGM,Caesar's, Las Vegas Sands property(though I think LVS gets one of the licenses for mass gaming market potential).
WYNN is a premium brand and will always trade at a higher multiple than other casinos as long as steve wynn is alive.
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