Wynn Resorts

China's anti-corruption campaign, its tightening of credit and its restrictions on transit visas are putting pressure on casinos operating in Macau and providing an opportunity for investors who see this as a temporary event. Of special interest is Wynn Resorts. Wynn Resorts operates casinos in Macau and Las Vegas, but its main raison d'être is entertainment.
   

Wynn Resorts, Limited (WYNN), together with its subsidiaries, develops, owns, and operates destination casino resorts. It operates in two segments, Macau Operations and Las Vegas Operations. The company operates Wynn Macau and Encore at Wynn Macau resort located in the People’s Republic of China. Its Macau resorts feature two luxury hotel towers with a total of 1,008 rooms and suites; 493 table games; 866 slot machines; a poker pit in approximately 280,000 square feet of casino gaming space; 8 restaurants; 2 spas and 1 salon; lounges; meeting facilities; 2 health clubs and spas; and approximately 57,000 square feet of retail space featuring boutiques, as well as a show in the rotunda. The company also owns and operates Wynn Las Vegas and Encore at Wynn Las Vegas resort with a total of 4,748 hotel rooms, suites, and villas; 230 table games; 1,854 slot machines; a race and sports book and poker room in approximately 186,000 square feet of casino gaming space, including a sky casino and private gaming salons; 34 food and beverage outlets; 2 spas and salons; lounges; and approximately 96,000 square feet of retail space featuring various boutiques. Its Las Vegas resorts also offer 3 nightclubs; a beach club; a Ferrari and Maserati automobile dealership; wedding chapels; an 18-hole golf course; approximately 283,000 square feet of meeting space; a theater; and an Encore theater presenting various headliner entertainment acts, as well as provides 2 showrooms and a beach club. Wynn Resorts, Limited was founded in 2002 and is based in Las Vegas, Nevada. (Daily Chart)

   January 2015
Price $146.99
1yr Target $198.24
Analysts 17
1yr Cap Gain 34.86%
Dividend $6.25
Yield 4.25%
1yr Est Tot Return 39.11%

3yr DivGR -3.85%
5yr DivGR 10.19%
P/E 17.93
PEG 1.69

Market Cap $14.90 Bil
Beta 1.49
EPS (ttm) $8.20
Payout Ratio 76.21%
EPS next yr $7.44
Forward P/E 19.77
Debt/Equity 77.53
ROA 9.40%
ROE UNK
ROI 19.80%
Sales $5.82 Bil
Income $836.10 Mil
Profit Margin 14.36%

The Fundamentals

It appears that the fundamentals began leveling off after 2011 for revenues and after 2013 for earnings. This is not the kind of numbers I normally like to see when I'm researching companies for new buys. I also don't like to see dividends that are volatile and somewhat unpredictable.  

Year
2015 Est
2014 Est
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003

Revenues
$5.37 Bil
$5.51 Bil
$5.62 Bil
$5.15 Bil
$5.26 Bil
$4.18 Bil
$3.04 Bil
$2.98 Bil
$2.68 Bil
$1.43 Bil
$0.72 Bil
$0.30 Bil
$0.10 Bil

Earnings
$7.44
$7.83
$7.17
$4.82
$4.88
$1.29
$0.17
$1.92
$2.34
$6.24
$-0.92
$-2.12
$-0.62

Dividends
$6.50
$6.25
$7.00
$9.50
$6.50
$8.50
$4.00
$0.00
$6.00
$6.00
$0.00
$0.00
$0.00

Payout Ratio
87.36%
79.82%
97.62%
197.09%
133.19%
658.91%
2352.94%
N/A
256.41%
96.15%
N/A
N/A
N/A

My Perspective

I'm interested in Wynn Resorts for a couple of reasons. It's in the the very lucrative casino business. I currently own stock in Las Vegas Sands and I've been very pleased with that investment. I also like the fact that Wynn Resorts goes further by emphasizing the entire entertainment package of staying at the Wynn Resorts. With Wynn opening an additional casino/resort in Macau, the recent opening of the Encore in Las Vegas, and the construction of the Wynn Boston, I intend to continue to monitor this stock for future purchases. I think there's something special going on with this company but I'm just not ready to commit funds until my research encourages me to.