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Factors Likely to Shape Wynn Resorts' (WYNN) Q1 Earnings

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Wynn Resorts, Limited (WYNN - Free Report) is likely to register decline in earnings and revenues when it reports first-quarter 2019 numbers.

In fourth-quarter 2018, the company reported earnings miss of 22.1%. Notably, the company’s bottom line has missed the Zacks Consensus Estimate in the three of the trailing four quarters, the average beat being 8.6%.

Which Way are Estimates Headed?

The Zacks Consensus Estimate for first-quarter earnings stands at $1.54, reflecting a year-over-year decline of 33%. We note that the consensus mark has witnessed downward revisions of 1.3% over the past seven days. For quarterly revenues, the Zacks Consensus Estimate is pegged at $1,642 million, mirroring approximately 4.3% decline from the year-ago quarter number. In the last reported quarter, total revenues of this company increased 4%.

Factors at Play

Wynn Resorts results in the quarter to be reported are likely to be impacted by Las Vegas operations’ dismal performance. The Zacks Consensus Estimate for revenues from Las Vegas operations is pegged at $409 million, down 5.3% year over year. However, revenues from Wynn Palace are expected to come in at $656 million, up 6.1% year over year.

Apart from the gaming business in Macau, Wynn Resorts has been increasingly focusing on bolstering non-gaming revenues. Given the decent visitation pattern in Macau, infrastructure development and the government’s efforts to boost tourism are likely to benefit the company’s non-gaming businesses.

Moreover, the company’s full-scale integrated resort in Cotai, Macau, is poised to witness increased visits from tourists and leisure gamblers over the long term, which should fortify the company’s position in the Cotai strip. Notably, such projects are expected to draw business and leisure travelers, and provide a solid platform for growth. In fact, building resorts in Boston and Macau will help the company capitalize on strong consumer spending trend in the region.

Wynn Resorts, Limited Price and EPS Surprise

Our Model Suggests a Beat

According to the Zacks model, a company with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) has a good chance of beating estimates if it also has a positive Earnings ESP. Zacks Rank #4 (Sell) or 5 (Strong Sell) stocks are best avoided, especially if they have a negative Earnings ESP. 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 +1.78% and a Zacks Rank #3, a combination that suggests that the company is likely to beat estimates. You can see the complete list of today’s Zacks #1 Rank stocks here.

Key Picks

Here are some companies from the same sector that are poised for an earnings beat in the upcoming releases:

Red Rock Resorts, Inc. (RRR - Free Report) has an Earnings ESP of +4.94% and a Zacks Rank of 3.

Melco Resorts & Entertainment Limited (MLCO - Free Report) has an Earnings ESP of +24.00% and a Zacks Rank #3.

Boyd Gaming Corporation (BYD - Free Report) has an Earnings ESP of +9.74% and a Zacks Rank #3.

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