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Why Is Wynn (WYNN) Down 9.4% Since Last Earnings Report?
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It has been about a month since the last earnings report for Wynn Resorts (WYNN - Free Report) . Shares have lost about 9.4% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Wynn due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Wynn Resorts reported impressive second-quarter 2023 results, with earnings and revenues surpassing the Zacks Consensus Estimate. Also, the top and bottom lines grew year over year.
The uptrend is backed by consistent performance growth in the company’s Macau and North America properties. Wynn Resorts witnessed growth in mass gaming, luxury retail and hotel businesses in Macau, portraying exceptional post-Covid recovery.
Q2 Earnings & Revenues
During the quarter, the company reported adjusted earnings of 91 cents per share, beating the Zacks Consensus Estimate of adjusted earnings of 51 cents per share by 78.4%. In the prior-year quarter, the company reported an adjusted loss of 82 cents per share.
Quarterly revenues of $1,595.8 million surpassed the consensus mark of $1,491 million by 7%. Also, the top line increased 75.6% on a year-over-year basis. The upside was mainly attributed to performance growth in Wynn Palace and Wynn Macau, resulting from an increase in gaming volumes, hotel occupancy and covers at restaurants.
Wynn Palace Operations
During the second quarter of 2023, Wynn Palace’s operating revenues were $468.4 million, compared with $58.7 million reported in the prior-year quarter. The reported value can be compared with our model’s projection of $231.1 million or 294% year-over-year growth, which is comparatively on the lower side.
Casino revenues in the reported quarter totaled $365.3 million, compared with $27.2 million reported in the prior-year quarter. Rooms, and food and beverage revenues surged a whopping 614.8% and 268.4% year over year to $50.1 million and $25.3 million, respectively. During the quarter under review, entertainment, retail and other revenues increased 57.6% year over year to $27.7 million.
In the VIP segment, table games turnover was $3,042.3 million, up 783.2% year over year. VIP table games win (loss) rate (based on turnover) was 4.24% against the loss of 1.94% reported in the prior-year quarter. Table drop in the mass market segment was $1,507.1 million, compared with $210.5 million reported in the prior-year quarter. Table games wins in mass market operations amounted to $305.8 million, compared with $41.6 million reported in the prior-year quarter.
During the reported quarter, revenue per available room or RevPAR increased 648.8% year over year to $307. Occupancy levels in the segment came in at 96.5%, compared with 28.5% reported in the prior-year quarter. The average daily rate (ADR) during the quarter came in at $318, up 119.3% on a year-over-year basis.
Wynn Macau Operations
During the second quarter, Wynn Macau’s operating revenues amounted to $301.6 million, compared with $58.6 million reported in the prior-year quarter. For this business operation, we projected year-over-year growth of 185.8% to $167.4 million.
Casino revenues in the reported quarter were $243 million, up 508% year over year. Rooms, and entertainment, and retail and other revenues grew 448.7% and 106.8% year over year to $26.1 million and $17.8 million, respectively. During the quarter, food and beverage revenues increased 180.4% year over year to $14.7 million.
Table games turnover in the VIP segment increased 360.9% year over year to $1,390.3 million. The VIP table games win rate (based on turnover) was 4.16%, lower than 4.79% reported in the prior-year quarter.
Table drop in the mass market segment was $1,223.3 million, compared with $216.2 million reported in the prior-year quarter. Table games' win in the mass market category was $216.4 million, compared with $30.6 million reported in the prior-year quarter.
During the reported quarter, RevPAR grew 453.2% year over year to $260. Occupancy levels in the segment came in at 96.8%, compared with 31.3% in the prior-year quarter. Furthermore, ADR came in at $269, up 79.3% year over year.
Las Vegas Operations
During the second quarter, operating revenues from Las Vegas operations were $578.1 million. The reported value is compared with $561.1 million reported in the year-ago quarter and our quarter’s expectation of $712.6 million or 27% year-over-year growth.
Casino revenues increased 1.9% year over year to $137.9 million. Revenues from food and beverage declined 0.8% to $195.1 million, while the same increased for rooms as well as entertainment, retail and other by 6.4% and 8.4% year over year to $177.8 million and $67.2 million, respectively.
Table games drop was down 0.9% year over year to $559.7 million. Table games wins also declined 7.8% year over year to $128 million. During the second quarter, table games win percentage of 22.9% was below 24.6% reported in the prior-year quarter.
During the quarter under review, RevPAR inched up 0.2% year over year to $418. The occupancy rate came in at 90.6%, flat year over year. ADR was $462, up 0.4% year over year.
Encore Boston Harbor
During the second quarter, operating revenues from Encore Boston Harbor operations amounted to $221.9 million, up from $210.2 million reported in the prior-year quarter. The reported value is comparatively lower than our projection of 6.4% year-over-year growth to $223.5 million.
Casino revenues increased 6.2% year over year to $166.8 million. Furthermore, revenues from rooms, food and beverage, as well as entertainment, retail and other increased 0.5%, 4.1% and 11.2% year over year to $22.5 million, $22 million and $10.6 million, respectively.
During the quarter, table games win percentage of 22.3% was above 21.9% reported in the prior-year quarter.
During the reported quarter, RevPAR increased 0.8% year over year to $371. The occupancy rate came in at 92.7%, down from 94.1% reported in the prior-year quarter. ADR was $400, up 2.3% year over year.
Operating Performance
During the second quarter of 2023, adjusted property EBITDAR was $524.5 million, compared with $179.2 million reported in the prior-year quarter.
In the quarter under review, adjusted property EBITDAR from Wynn Macau totaled $89.6 million against ($40.4) million reported in the prior-year quarter. Adjusted property EBITDAR from Las Vegas operations was $224.1 million, compared with $226.7 million reported in the year-ago quarter. Adjusted property EBITDAR from Encore Boston Harbor was $69.1 million, compared with $63.7 million reported in the prior-year quarter.
Cash Position
As of Jun 30, 2023, Wynn Resorts’ cash and cash equivalents totaled $3.65 billion, on par with the value reported as of 2022 end.
Total current and outstanding debt at the end of second-quarter 2023 amounted to $12.14 billion. The figure included $2.65 billion of Wynn Las Vegas-related debt, $6.73 billion of Macau debt, $2.15 billion of Wynn Resorts Finance debt and $613.8 million of debt held by the retail joint venture, which the company consolidated.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended upward during the past month.
The consensus estimate has shifted 77.92% due to these changes.
VGM Scores
Currently, Wynn has a strong Growth Score of A, a grade with the same score on the momentum front. Charting a somewhat similar path, the stock was allocated a grade of B on the value side, putting it in the top 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Wynn has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Performance of an Industry Player
Wynn belongs to the Zacks Gaming industry. Another stock from the same industry, Light & Wonder (LNW - Free Report) , has gained 1.4% over the past month. More than a month has passed since the company reported results for the quarter ended June 2023.
Light & Wonder reported revenues of $731 million in the last reported quarter, representing a year-over-year change of +19.8%. EPS of $1.02 for the same period compares with -$0.07 a year ago.
For the current quarter, Light & Wonder is expected to post earnings of $0.34 per share, indicating a change of +142.9% from the year-ago quarter. The Zacks Consensus Estimate has changed -2.2% over the last 30 days.
Light & Wonder has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of C.
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Why Is Wynn (WYNN) Down 9.4% Since Last Earnings Report?
It has been about a month since the last earnings report for Wynn Resorts (WYNN - Free Report) . Shares have lost about 9.4% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Wynn due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Wynn Resorts Q2 Earnings & Revenues Beat Estimates
Wynn Resorts reported impressive second-quarter 2023 results, with earnings and revenues surpassing the Zacks Consensus Estimate. Also, the top and bottom lines grew year over year.
The uptrend is backed by consistent performance growth in the company’s Macau and North America properties. Wynn Resorts witnessed growth in mass gaming, luxury retail and hotel businesses in Macau, portraying exceptional post-Covid recovery.
Q2 Earnings & Revenues
During the quarter, the company reported adjusted earnings of 91 cents per share, beating the Zacks Consensus Estimate of adjusted earnings of 51 cents per share by 78.4%. In the prior-year quarter, the company reported an adjusted loss of 82 cents per share.
Quarterly revenues of $1,595.8 million surpassed the consensus mark of $1,491 million by 7%. Also, the top line increased 75.6% on a year-over-year basis. The upside was mainly attributed to performance growth in Wynn Palace and Wynn Macau, resulting from an increase in gaming volumes, hotel occupancy and covers at restaurants.
Wynn Palace Operations
During the second quarter of 2023, Wynn Palace’s operating revenues were $468.4 million, compared with $58.7 million reported in the prior-year quarter. The reported value can be compared with our model’s projection of $231.1 million or 294% year-over-year growth, which is comparatively on the lower side.
Casino revenues in the reported quarter totaled $365.3 million, compared with $27.2 million reported in the prior-year quarter. Rooms, and food and beverage revenues surged a whopping 614.8% and 268.4% year over year to $50.1 million and $25.3 million, respectively. During the quarter under review, entertainment, retail and other revenues increased 57.6% year over year to $27.7 million.
In the VIP segment, table games turnover was $3,042.3 million, up 783.2% year over year. VIP table games win (loss) rate (based on turnover) was 4.24% against the loss of 1.94% reported in the prior-year quarter. Table drop in the mass market segment was $1,507.1 million, compared with $210.5 million reported in the prior-year quarter. Table games wins in mass market operations amounted to $305.8 million, compared with $41.6 million reported in the prior-year quarter.
During the reported quarter, revenue per available room or RevPAR increased 648.8% year over year to $307. Occupancy levels in the segment came in at 96.5%, compared with 28.5% reported in the prior-year quarter. The average daily rate (ADR) during the quarter came in at $318, up 119.3% on a year-over-year basis.
Wynn Macau Operations
During the second quarter, Wynn Macau’s operating revenues amounted to $301.6 million, compared with $58.6 million reported in the prior-year quarter. For this business operation, we projected year-over-year growth of 185.8% to $167.4 million.
Casino revenues in the reported quarter were $243 million, up 508% year over year. Rooms, and entertainment, and retail and other revenues grew 448.7% and 106.8% year over year to $26.1 million and $17.8 million, respectively. During the quarter, food and beverage revenues increased 180.4% year over year to $14.7 million.
Table games turnover in the VIP segment increased 360.9% year over year to $1,390.3 million. The VIP table games win rate (based on turnover) was 4.16%, lower than 4.79% reported in the prior-year quarter.
Table drop in the mass market segment was $1,223.3 million, compared with $216.2 million reported in the prior-year quarter. Table games' win in the mass market category was $216.4 million, compared with $30.6 million reported in the prior-year quarter.
During the reported quarter, RevPAR grew 453.2% year over year to $260. Occupancy levels in the segment came in at 96.8%, compared with 31.3% in the prior-year quarter. Furthermore, ADR came in at $269, up 79.3% year over year.
Las Vegas Operations
During the second quarter, operating revenues from Las Vegas operations were $578.1 million. The reported value is compared with $561.1 million reported in the year-ago quarter and our quarter’s expectation of $712.6 million or 27% year-over-year growth.
Casino revenues increased 1.9% year over year to $137.9 million. Revenues from food and beverage declined 0.8% to $195.1 million, while the same increased for rooms as well as entertainment, retail and other by 6.4% and 8.4% year over year to $177.8 million and $67.2 million, respectively.
Table games drop was down 0.9% year over year to $559.7 million. Table games wins also declined 7.8% year over year to $128 million. During the second quarter, table games win percentage of 22.9% was below 24.6% reported in the prior-year quarter.
During the quarter under review, RevPAR inched up 0.2% year over year to $418. The occupancy rate came in at 90.6%, flat year over year. ADR was $462, up 0.4% year over year.
Encore Boston Harbor
During the second quarter, operating revenues from Encore Boston Harbor operations amounted to $221.9 million, up from $210.2 million reported in the prior-year quarter. The reported value is comparatively lower than our projection of 6.4% year-over-year growth to $223.5 million.
Casino revenues increased 6.2% year over year to $166.8 million. Furthermore, revenues from rooms, food and beverage, as well as entertainment, retail and other increased 0.5%, 4.1% and 11.2% year over year to $22.5 million, $22 million and $10.6 million, respectively.
During the quarter, table games win percentage of 22.3% was above 21.9% reported in the prior-year quarter.
During the reported quarter, RevPAR increased 0.8% year over year to $371. The occupancy rate came in at 92.7%, down from 94.1% reported in the prior-year quarter. ADR was $400, up 2.3% year over year.
Operating Performance
During the second quarter of 2023, adjusted property EBITDAR was $524.5 million, compared with $179.2 million reported in the prior-year quarter.
In the quarter under review, adjusted property EBITDAR from Wynn Macau totaled $89.6 million against ($40.4) million reported in the prior-year quarter. Adjusted property EBITDAR from Las Vegas operations was $224.1 million, compared with $226.7 million reported in the year-ago quarter. Adjusted property EBITDAR from Encore Boston Harbor was $69.1 million, compared with $63.7 million reported in the prior-year quarter.
Cash Position
As of Jun 30, 2023, Wynn Resorts’ cash and cash equivalents totaled $3.65 billion, on par with the value reported as of 2022 end.
Total current and outstanding debt at the end of second-quarter 2023 amounted to $12.14 billion. The figure included $2.65 billion of Wynn Las Vegas-related debt, $6.73 billion of Macau debt, $2.15 billion of Wynn Resorts Finance debt and $613.8 million of debt held by the retail joint venture, which the company consolidated.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended upward during the past month.
The consensus estimate has shifted 77.92% due to these changes.
VGM Scores
Currently, Wynn has a strong Growth Score of A, a grade with the same score on the momentum front. Charting a somewhat similar path, the stock was allocated a grade of B on the value side, putting it in the top 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Wynn has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Performance of an Industry Player
Wynn belongs to the Zacks Gaming industry. Another stock from the same industry, Light & Wonder (LNW - Free Report) , has gained 1.4% over the past month. More than a month has passed since the company reported results for the quarter ended June 2023.
Light & Wonder reported revenues of $731 million in the last reported quarter, representing a year-over-year change of +19.8%. EPS of $1.02 for the same period compares with -$0.07 a year ago.
For the current quarter, Light & Wonder is expected to post earnings of $0.34 per share, indicating a change of +142.9% from the year-ago quarter. The Zacks Consensus Estimate has changed -2.2% over the last 30 days.
Light & Wonder has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of C.