Anticipates Enhanced Performance by Wynn in Las Vegas, Decreased Focus in Macau
🔥 Unleashed Insights. Deutsche Bank's analyst Carlo Santarelli has painted a mixed picture for Wynn Resorts, with an ongoing Buy rating and a bit of a downward adjustment in price targets. Despite economic uncertainties, Wynn is holding its own, especially in the Vegas scene.
In his recent investor note, Santarelli highlights the Las Vegas operations as a strong point, downplaying concerns about international patronage. However, the first quarter of 2025 doesn't seem promising, as he predicts a slight dip in earnings reports.
Meanwhile, Macau presents a more complicated landscape. Although the expectations for Q1 gross gaming revenue growth were high, the actual results show a meager one percent increase compared to 2024. Wynn's Macanese casinos have been negatively impacted by poor hold rates and a lower market share.
However, even with the modest growth and lingering geopolitical tensions, Santarelli remains optimistic about Macau, stating that it remains "broadly stable." The analyst also contends that Wynn shares are undervalued, with no value being ascribed to their forthcoming United Arab Emirates project, worth an estimated $16 per share.
With geopolitical tensions looming, investors may be wary of the impact on international travel. Santarelli acknowledges these concerns but doubts they will significantly affect Wynn's high-roller international business, predicting minimal impact for early 2025. He maintains a steady outlook for Wynn's Las Vegas operations, except for a slight decline of 1.5 percent for the remainder of the year through 2026.
While Santarelli's commentary on the broader situation is scarce, the broader trends revealMacau's vulnerability to economic forces and Wynn's mounting earnings pressure across markets. Stakeholders should keep a close eye on geopolitical developments, potential stimulus measures in Macau, and the performance of the UAE project, as they could significantly impact Wynn's future prospects.
- Despite Carlo Santarelli's optimism about Macau, he acknowledges geopolitical tensions that may affect international travel, potentially impacting Wynn Resorts' high-roller international business.
- In his recent report, Santarelli anticipates a slight dip in Wynn Resorts' earnings reports for the first quarter of 2025, but he remains optimistic about the future prospects of the company, particularly its Las Vegas operations.
- While Wynn's Las Vegas operations are a strong point, Santarelli notes that Wynn's Macanese casinos have been negatively impacted by poor hold rates and a lower market share, making Macau a more complicated landscape for the casino-and-gambling business.
- Although Wynn's earnings are under pressure due to economic forces in Macau and potential earnings reports in the first quarter of 2025, analyst Santarelli believes that Wynn's share price does not reflect the potential value of its forthcoming United Arab Emirates project, which could contribute an estimated $16 per share to the company's value.
