Wynn Resorts, Limited

This is our first report on Wynn Resorts, a well-known operator of casinos and resorts across the globe.  The company delivered a mixed set of results surpassing Wall Street expectations in terms of revenues but missing out on earnings. In Boston, Encore had a successful quarter and generated $61 million in EBITDA, similar to Vegas. The company observed strength throughout the casino, with record gross gaming revenue and record hotel revenue, driven by strength in both ADR and occupancy on the nongaming side. They are also continuing to complete the plans for the upcoming construction project that will bring additional parking, dining, and entertainment options across the street from the property. Furthermore, the Macau government kept moving the concession procedure. In September, they submitted their tender concession application, and the government is now considering the submissions with a decision anticipated by year’s end. The management is optimistic about Macau’s long-term prospects, given the region’s high demand for travel and tourism. In addition, Wynn is progressing with the planning for Wynn Marjan, their integrated resort in the United Arab Emirates. Overall, the company is well-positioned to drive sales in the coming quarters. We initiate coverage on the stock of Wynn Resorts with a ‘Hold’ rating.