Wynn Resorts Ltd a ‘Compelling’ Story – Credit Suisse

By Sam Boughedda

Shares of Wynn Resorts Ltd (NASDAQ:) were upgraded to Outperform from Neutral with an unchanged price target of $117 per share by a Credit Suisse analyst on Thursday.

He told investors that at current levels, they believe Wynn is “one of the more compelling stories in gaming.” The analyst pointed to three areas where they see a potential upside, including Vegas trends, Macau sentiment, and valuation.

“Upside to Vegas trends driven in part by the convention center expansion, almost doubling the available meeting space,” stated the analyst. “We think Macau sentiment is near a bottom (casinos were briefly closed in 3Q22), and although the timeline of a recovery is admittedly unclear, we think that is more than priced in. When that happens, we think a mix shift into higher margin mass/premium mass gaming will benefit EBITDA margins, not reflected in street estimates.”

Finally, on the company’s valuation, he remarked that it is “compelling and presents an attractive risk/reward.”

“While the Macau recovery timeline is opaque, we don’t think you are paying for that optionality. We see valuation support at ~$45/share (or down ~10%) a level we think implies zero value for Macau and zero value for sports betting.”

Wynn shares are up more than 8% Thursday.

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