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Wynn Resorts Beats on Earnings in 3Q15: Can it Continue?

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Aug. 18 2020, Updated 10:35 a.m. ET

Wynn Resorts’ hits and misses

Wynn Resorts’ (WYNN) third quarter numbers missed most Wall Street analysts’ estimates. The company’s revenues for the third quarter fell to $996.3 million. This was ~2.9% shy of the target of $1.03 billion expected by various analysts. This was due to weaker performances in Macau and Las Vegas.

However, on the positive end, the company’s earnings fell lower than expected, and it reported adjusted EPS (earnings per share) of 86 cents. This was 2.7% more than the consensus estimates of 84 cents. This was because the casino and general and administrative expenses fell by about 18.7% during the quarter. The mass market performance was also better than expected as the company lowered its minimum bets and also moved more tables towards the segment.

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Analysts’ estimates for 2016 and 2017

After Wynn Resorts’ dismal performance in fiscal 2015, analysts are expecting the tables to turn around in 2016:

  • Revenue is expected to grow by 21% in 2016, to $ 5,035 million from $ 4,158 million in 2015. Revenue is expected to further grow by 12.8% in 2017, to $ 5,679.
  • EBITDA[1. earnings before interest, taxes, depreciation, and amortization] growth is also expected to turn positive in 2016. It’s expected to grow by 15% in 2016 to $ 1,246 million, from $ 1,086 million in 2015, and by 22% in 2017, to $ 1,523 million.
  • Similarly, EPS is expected to grow by 20% in 2016, to $3.72, and by 33% in 2017, to $4.94.

To know whether Wynn Resorts can deliver on these estimates, we’ll have to monitor the mass market’s performance and the Chinese government actions that seem to be promising.

We’ll be covering all this for you, so be sure to check the Market Realist Wynn Resorts page. We’ll also cover 3Q15’s earnings for other major casino players like Las Vegas Sands (LVS), Melco Crown Entertainment (MPEL), and MGM Resorts (MGM). For a broader exposure, investors can invest in the Consumer Staples Select Sector SPDR Fund (XLP).

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