Key Points Wynn Resorts’ Q3 2023 revenues surged back 88% year-over-year (YoY) to $1.67 billion. Wynn’s Macau operations saw significant revenue increases in Q3 2023.
Wynn plans to open Wynn Marjan, its $3.9 billion 1,500-room luxury resort, in the UAE in 2027. Wynn Resorts continues to experience positive normalization. The company operates casino resorts in Las Vegas, Macao, and Boston. The stock is a member of the consumer discretionary sector.
Business is back above pre-pandemic levels on the top line and bottom line per its adjusted property earnings before interest, taxes, depreciation, amortization and restructuring costs (EBITDAR) in the U.S. and 85% of the pre-COVID levels in Macau.
Wynn shares were down after a strong Q3 2023 earnings report; investors may not be thinking longer term with its new growth engine in the pipeline. Wynn has bright prospects in the United Arab Emirates (UAE), with its Wynn Al Marjan Island expected to open in 2027.
The UAE is a destination Las Vegas Sands Co. might consider.
To bolster tourism, the UAE has been leaning on relaxing its gambling laws, similar to China, the UAE may pursue a similar framework except in Macau. Wynn Resorts had announced its plans to invest $3.9 billion to construct the 1,000-foot-high, 1,500-room luxury resort Wynn Marjan on the manmade Al Marjan Island of Ras Al-Khaimah. Wynn Resorts CEO Craig Billings commented on their position in the UAE regarding gambling, “Our view is that it will likely be us and us alone for a multi-year period given that we are well underway on construction now. And, of course, we all know the advantages of being first, as we have seen in other markets.”
Ras Al-Khaimah continues to grow as a tourist destination, the sixth largest city in the UAE after Dubai. The integrated casino resort is developed with partners Marjan LLC and RAK Hospitality Holdings LLC. It would be the largest foreign investment in the country. Ras Al Khaimah should have over 3.8 million visitors annually by 2027 and up to 5.5 million by 2030.
Wynn made the surprise move of curtailing its WynnBET sports betting and gaming app. It shut down its operations in eight states but will continue operating in Nevada and Massachusetts, where it has physical casino locations but is too costly with a low return. Wynn Resorts is still contemplating whether to continue operating the app in New York and Michigan.
The lifting of the China zero-COVID policy has resulted in a dramatic recovery in Macau. Wynn’s Macau operations, comprised of Wynn Palace and Wynn Macau, generated the lion’s share of revenues in the quarter.
On November 9, Wynn Resorts reported its fiscal Q3 2023 earnings for the quarter ended September 2023. The company reported a non-GAAP earnings per share (EPS) profit of 99 cents, beating consensus analyst estimates of 74 cents by 25 cents. Revenues surged 87.9% YoY to $1.67 billion, topping $1.58 billion analyst estimates.
Wynn CEO Craig Billings pointed out that Las Vegas produced records in Q3 gross gaming, food and beverage, and hotel revenue with a 10% YoY growth in RevPAR. The 12% YoY adjusted property EBITDA was accomplished on difficult YoY comps despite its new agreement with The Culinary Union. Wynn is the second largest casino operator in Las Vegas behind Caesar’s Entertainment Inc. and ahead of MGM Resorts International. Macau generated $255 million of EBITDA, 85% of pre-COVID levels.
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The daily candlestick chart on LVS illustrates a descending price channel that started after peaking at $109.98 on July 27, 2023. The descending trend lines run parallel as shares haven’t been able to break out of the range. It attempted to break out on Nov. 3, 2023, peaking at $95.63, but fell back into it after its Q3 2023 earnings release.
Before you consider Wynn Resorts, you should know that while Wynn Resorts currently has a “Moderate Buy” rating among analysts, top-rated analysts believe that five stocks are better buys.
