Wynn’s recent performance
Wynn Resorts’ (WYNN) share price plummeted 6.1% immediately after its 4Q14 results. WYNN’s 200-day moving average share price is $184.93 with a 52-week low and high of $138.97 and $247.95, respectively.
The above chart shows that WYNN’s share price is trading near a 52-week low. This is due mainly to its poor operating performance in Macau and Las Vegas.
WYNN’s year-over-year adjusted property earnings witnessed a huge decline in the fourth quarter of 2014. In addition, WYNN recorded a fall in VIP as well as mass market table win, as we saw in the previous parts of this series.
Stocks for Las Vegas Sands (LVS) also fell immediately after its 4Q14 results. To know more, read Share price of Las Vegas Sands plunges post 4Q14 but bounces back. Melco Crown Entertainment (MPEL) and MGM Resorts (MGM) are scheduled to report their 4Q14 results on February 12 and February 17, respectively.
Share prices for all these casino companies are expected to gain momentum once new resorts are open to the public.
A good way to get exposure to these companies is to invest in ETFs such as the VanEck Vectors Gaming ETF (BJK). BJK has ~7% exposure to WYNN. To invest in a much broader sector, you might want to invest in the Consumer Discretionary Select Sector SPDR Fund (XLY), which has ~1% exposure in WYNN.
WYNN’s relative performance
WYNN, LVS, and MPEL have performed poorly over the last 12 months compared to the SPDR S&P 500 ETF (SPY). These companies derive more than 60% of their revenues from Macau, where factors such as the anti-corruption campaign and the smoking ban legislation have negatively impacted these companies’ cash flows.
Note: When this article was originally published, it indicated “a 52-week high and low of $138.97 and $247.95, respectively.” It has since been corrected to read “a 52-week low and high of $138.97 and $247.95, respectively.” We regret the error.