Goldman Downgrades Wynn Resorts On Challenges At Its Macau Unit

Goldman Sachs downgraded Wynn Resorts to Hold from Buy on September 6 and lowered the price target to $95 (8.3% upside potential) from $96. Goldman also removed the stock from its Conviction List, citing slower recovery at the company’s Macau unit.

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Goldman analyst Stephen Grambling has lowered his 2021 forecasts for the Macau unit as he expects softer VIP gaming revenues in 2021. The recent run-up in Wynn Resorts shares in August also led to the downgrade.

Wynn Resorts Limited’s (WYNN) dependency on Macau’s gaming market is seen as a challenge. Last month, the casino operator reported 2Q results, wherein the gross gambling revenue across Macau was down nearly 95% year-over-year in July, which was the fourth straight month with revenue declining over 90%.

Wynn Resorts reported a loss of $6.14 per share, missing the Street estimates of $4.98. Its revenues of $85.7 million were also far below the consensus estimate of $275.8 million. The disappointing numbers were the result of casino closures amid the pandemic and depressed business and leisure travel. (See WYNN stock analysis on TipRanks).

Currently, the Street has a cautiously optimistic outlook on the stock. The Moderate Buy analyst consensus is based on 9 Buys and 4 Holds. The average price target of $92.67 implies upside potential of 5.6% to current levels. Shares are down by 36.8% year-to-date.