Wynn Resorts Upgraded to Buy by UBS, Al Marjan Resort Driving Growth

UBS has upgraded Wynn Resorts to a Buy rating, driven by the potential of the Al Marjan resort in the UAE. Analysts' average target price suggests a minor downside from the current stock price, while GuruFocus estimates indicate a downside from current levels. The stock is trading above its fair value.

UBS Group has upgraded Wynn Resorts (NASDAQ: WYNN) to a "buy" rating from "hold," citing increased upside potential from the Al Marjan resort project in Ras Al Khaimah, United Arab Emirates. The casino company's resort project is expected to benefit from a more favorable view on its potential, according to UBS [1].

The upgrade reflects a bullish outlook on Wynn Resorts' prospects and growth potential, particularly driven by the Al Marjan resort project. UBS has raised its target price to $147, suggesting a potential upside of over 30% from the current stock price. The Al Marjan project is expected to bring significant returns, with UBS raising its run-rate adjusted property EBITDAM estimate for Al Marjan to $730 million, a 16% increase from Wynn's base-case guidance of $625 million [1].

UBS values the Al Marjan project at roughly $34 per share, well above the $7-$12 currently implied by the market. The upgrade also comes amidst a period of robust growth for the gaming industry, driven by increasing demand for entertainment and leisure activities. Wynn Resorts has been at the forefront of this growth, with a strong market position and a diversified portfolio of assets [1].

Despite recent market volatility, UBS remains optimistic about Wynn Resorts' ability to navigate challenges and capitalize on growth opportunities. The firm's sum-of-the-parts analysis indicates that the company's fundamental performance is likely to overshadow near-term transaction-related issues. Investors should continue to monitor Wynn Resorts' progress as it integrates new assets and navigates the evolving gaming landscape [1].

References:
[1] https://www.ainvest.com/news/ubs-upgrades-wynn-resorts-buy-citing-al-marjan-project-upside-potential-2508/
[2] https://finance.yahoo.com/news/al-marjan-macau-strength-drive-125241602.html