Wynn Resorts leads others in second-quarter earnings

The ritual of releasing earnings is a significant event for every casino company in Las Vegas.

Management shares with employees, investors and analysts what has been going on in the gaming business over the last 90 days and often gives guidance on what it expects financially for the next quarter or fiscal year.

With earnings season kicking into high gear next week, Wynn Resorts Ltd. will, on Monday, lead the pack.

Analysts expect the operator of high-end casinos in Las Vegas and Macau to report earnings of 99 cents per share for the quarter ended June 30, compared to 52 cents a share for the second quarter of last year. Revenue was estimated at $1.26 billion for the second quarter, up from $1.03 billion for the same period last year.

"Our view remains that Wynn continues to offer best-in-class service and a premium product, which should continue to benefit the company's Macau operations, in particular, as competition in the VIP segment continues to intensify," said David Katz, an equity analyst with Jefferies, in an industry report released Friday.

Katz also expects Wynn Resorts to show "modestly improving trends" in Las Vegas.

In his report, Katz forecasts 16.2 percent higher net revenues of $369.6 million and 23 percent gains in earnings before interest, taxes, depreciation and amortization, or EBITDA, of $80.1 million. Previously, he forecast Las Vegas net revenues and EBITDA of $358.3 million and $67.4 million, respectively.

Macau net revenues also were revised to reflect growth of 20.1 percent to $858 million, versus a 16 percent increase in growth to $828.8 million. His EBITDA estimate for the second quarter now calls for growth of 22.7 percent to $265.2 million, compared with previous expectations of 18.3 percent growth to $255.7 million.

"As a result of our estimated revisions, our price target on Wynn shares is raised to $189 from $174," said Katz, who rates the stock a "buy."

His positive report helped send Wynn shares to a 52-week high of $162.70, before closing at $162.62, up $3.84, or 2.42 percent, with 1.82 million shares traded on Friday. Wynn's prior 52-week high was $161.74.

Average volume has been 1.9 million shares traded daily over the past 30 days. Since May 10, when Wynn Resorts closed at a 52-week high of $151.73, shares of the company have hit four new 52-week highs on the Nasdaq Global Select Market.

Other publicly traded casino companies that have announced earnings release dates include Las Vegas Sands Corp. on July 26 and MGM Resorts International on Aug. 8.

Analysts surveyed by Yahoo Finance expect Las Vegas Sands to report earnings of 44 cents on revenues of $2.21 billion, while MGM Resorts is expected to post a loss of 13 cents a share on estimated revenue of $1.58 billion.

Contact reporter Chris Sieroty at
csieroty@reviewjournal.com or 702-477-3893.