Wynn Declines 3.8% on Mixed Q4 Results

Shares of Wynn Resorts, Limited (WYNN) fell 3.8% in Tuesday’s extended trade after the company posted mixed results for the fourth quarter of 2021. The company engages in the development, ownership and operation of destination casino resorts.

The company has reported an adjusted loss of $1.54 per share, wider than analysts’ expectations of a loss of $1.25 per share. The company had registered a loss of $2.53 per share in the same quarter last year.

Revenue of $1.05 billion increased 53.5% from $686 million a year ago and surpassed the Street’s estimate of $994.1 million. The upside was primarily due to higher revenue across all units, especially entertainment, rooms and food & beverage.

Adjusted Property EBITDA was $149.1 million for the fourth quarter of 2021, compared to $69.8 million for the same quarter last year.

Wynn’s CEO, Craig Billings, said, “On the development front, we were excited to announce our plans to develop and manage a luxury integrated resort in the UAE, along with our partners, Marjan and RAK Hospitality Holding. The project further diversifies our business, extending our brand into the Middle East and Europe.”

Price Target

Following the release, Deutsche Bank analyst Carlo Santarelli maintained a Buy rating on Wynn and reduced the price target to $131 from $140. The new price target implies 39.2% upside potential from current levels.

Santarelli said, “Looking ahead to the 1Q22, we expect Las Vegas to be challenging, given the retrenchment in occupancy in January (61% as per management), what we believe is a mediocre February, and what should be a strong March.”

“Along similar lines, we think the 1Q22 at EBH is likely to drift lower, given modestly higher labor expenses (~$4 mm per quarter) and, more importantly, the impact of the holiday weekend storm and Omicron.  Like Las Vegas, we expect EBH to re-ramp in the 2Q22, though as we are for most regional markets, we have some level of concern for the sustainability of 2H21 gaming revenue levels, which, we note, have helped margins remain elevated, despite some incremental cost creep,” he added.

The rest of the Street is cautiously optimistic about the stock with a Moderate Buy consensus rating based on 3 Buys and 6 Holds. The average Wynn price target of $106.94 implies 11.1% upside potential from current levels.

News Sentiment

News Sentiment for Wynn is Positive based on 23 articles over the past seven days. All the articles have Bullish sentiment, compared to a sector average of 61%, and none have Bearish Sentiment, compared to a sector average of 39%.

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