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Factors Setting the Tone for Wynn Resorts (WYNN) Q2 Earnings

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Wynn Resorts, Limited (WYNN - Free Report) is scheduled to release second-quarter 2018 results on Aug 1, after market close. The company’s earnings have surpassed the Zacks Consensus Estimate in each of the trailing four quarters, with an average beat of 9.9%.

Q2 Expectations

The question lingering in investors’ minds now is whether Wynn Resorts will be able to deliver a positive earnings surprise in the quarter to be reported as well. Notably, the Zacks Consensus Estimate for second-quarter earnings is pegged at $2.03, higher than $1.18 reported in the year-ago quarter. In the past 30 days, the company’s earnings estimates for the quarter to be reported have been revised downward by 1%. In the last reported quarter, it witnessed earnings growth of 79.7% on a year-over-year basis.

Moreover, the Zacks Consensus Estimate for revenues is $1,694 million, up 10.8% from the prior-year actual figure.

Let’s delve deeper to find out how the company’s top and bottom line will shape up this earnings season.

Factors at Play

Wynn Resorts’ solid share of revenues is generated from the gaming business in Macau. Of late, it has been increasingly focusing on boosting non-gaming revenues as well, which is expected to drive the company’s top and bottom line in the second quarter. Also, infrastructure development and government’s efforts to boost tourism in Macau are expected to aid Wynn Resorts’ top-line performance. 

However, disappointing gambling revenues from the Macau region in May and June has negatively impacted most of the gaming stocks. Although gambling revenues were up for the 23rd straight months in June, it still remains below the highest level achieved in 2012.

According to analysts, casino traffic in Macau declined in May and June due to robust interest in the FIFA World Cup. The Zacks Consensus Estimate for second-quarter revenues from Macau operations is pegged at $613 million, reflecting a decline of 10.2% from the year-ago quarter number.

On a year-over-year basis, revenues from Las Vegas operations is likely to increase 4%, courtesy of a developing tourism industry and overall uplift in consumer discretionary spending.

Additionally, Wynn Resorts’ focus on the non-gaming business should help the company to consistently improve its margins.

Wynn Resorts, Limited Price, Consensus and EPS Surprise

What Does the Zacks Model Say?

Our proven model does not conclusively show that Wynn Resorts is likely to beat earnings estimates in the second quarter. This is because a stock needs to have both — a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) — for this to happen. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Wynn Resorts has an Earnings ESP of -7.70% and a Zacks Rank #4 (Sell), which makes surprise prediction difficult.

Stocks to Consider

Here are a few other stocks from the same sector that are poised for an earnings beat this quarter.

Caesars Entertainment Corp. (CZR - Free Report) has an Earnings ESP of +33.33% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

Las Vegas Sands Corp. (LVS - Free Report) has an Earnings ESP of +0.91% and a Zacks Rank of 3.

Hilton Grand Vacations Inc. (HGV - Free Report) has an Earnings ESP of +11.36% and a Zacks Rank #3.

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