Wynn Weak in Third Quarter, Analysts See Value in Shares

Wynn Resorts (NASDAQ: WYNN) reported third-quarter results on Thursday night as the slump in Macau and Las Vegas continued. For the quarter ended September 30, the company earned 33 cents per share and generated revenue of 1.69 billion dollars. Analysts had expected earnings of 59 cents per share and revenue above 1.7 billion dollars. Adjusted EBITDAR fell about 106 million dollars to 464.2 million dollars. Even so, the shares rose at midday.

Stifel analyst Steven Wieczynski argues that the premium focus in Las Vegas has been overlooked and that the shares are seriously undervalued. According to Wieczynski, the UAE project and the Macau assets are not being valued enough at current prices. By his calculations, the UAE project could be worth 19 to 25 dollars in today's dollars. The project's opening is targeted for September 2027.

Wynn CEO Craig Billings said the company has started thinking about plans for the unused land in Las Vegas. Some estimates put the land's value at 1 billion dollars or more. Billings also pointed to Texas. The Democrats' sweep of all the state's major offices in Tuesday's midterm elections strengthened expectations of gaming expansion there. Billings said the company's brands have resonated in Texas and that it will look at the opportunities.

Jefferies analyst David Katz wrote that because the war in Iran remains unresolved, the integrated resort in the UAE is the focus of investors. Looking at potential customer groups, Katz said the facility has more than one path to success. The company put its remaining equity needs for the UAE at between 465 million and 590 million dollars. That figure came in below the estimate for the second quarter.