Wynn Resorts Stock Plunges After Casino Operator's Profit and Sales Miss Estimates
Tuesday, Nov 5, 2024 3:27 pm ET
2min read Wynn Resorts (WYNN) shares took a significant hit on Tuesday, November 4, 2024, following the company's release of third-quarter financial results that missed analysts' estimates for both profit and sales. The casino operator reported operating revenues of $1.69 billion, falling short of the consensus of $1.73 billion. Adjusted Property EBITDAR declined slightly to $527.7 million from $530.4 million a year ago, while adjusted EPS of $0.90 missed the street view of $1.01.
The performance of individual properties contributed to the overall revenue and earnings miss. Wynn Palace in Macau saw operating revenues fall to $519.8 million from $524.8 million a year ago, and adjusted Property EBITDAR declined to $162.3 million from $177.0 million last year. In Las Vegas, operating revenues totaled $607.2 million vs. $619.0 million a year ago, and adjusted Property EBITDAR was $202.7 million, compared to $219.7 million a year earlier. However, Wynn Macau's operating revenues rose to $352.0 million from $295.0 million a year ago, and adjusted Property EBITDAR increased to $100.6 million from $77.9 million year-over-year.
The competitive environment in Macau played a significant role in Wynn Resorts' underwhelming results. Despite a 6% increase in operating revenue and a 10% rise in combined mass table and slot wins, Wynn Resorts' EBITDA remained relatively flat at $263 million. The company's strategy to invest in its market-leading assets and five-star service, including enhancing food and beverage programming and improving the loyalty program, is aimed at driving share gains in the long term. However, the current competitive dynamic in Macau requires continued investment and innovation to maintain a strong position in the market.
Wynn Resorts' strategic investments, such as the Wynn Al Marjan Island project, have not significantly impacted its financial performance in the third quarter. The company's operating revenues increased by $21.4 million to $1.69 billion, while Adjusted Property EBITDAR decreased slightly to $527.7 million. Despite these investments, Wynn Resorts' net loss attributable to the company was $32.1 million, compared to a net loss of $116.7 million in the same period last year. The company's CEO, Craig Billings, stated that the investments are expected to support strong long-term free cash flow growth and strengthen the company's position in its markets. However, the company's stock price has fallen due to the miss in profit and sales estimates.
The increased share repurchase authorization to $1 billion signals Wynn Resorts' commitment to returning capital to shareholders. This could potentially boost the stock price through reduced supply and increased earnings per share. However, the recent earnings miss and strategic investments may impact investor sentiment and stock price performance in the short term.
In conclusion, Wynn Resorts' stock price plummeted following a revenue and earnings miss in Q3 2024. The company's strategic investments, competitive environment in Macau, and share repurchase program all play a role in the company's financial performance and stock price. Investors should carefully consider these factors and monitor the company's progress in the coming quarters to make informed decisions about their investments in Wynn Resorts.
The performance of individual properties contributed to the overall revenue and earnings miss. Wynn Palace in Macau saw operating revenues fall to $519.8 million from $524.8 million a year ago, and adjusted Property EBITDAR declined to $162.3 million from $177.0 million last year. In Las Vegas, operating revenues totaled $607.2 million vs. $619.0 million a year ago, and adjusted Property EBITDAR was $202.7 million, compared to $219.7 million a year earlier. However, Wynn Macau's operating revenues rose to $352.0 million from $295.0 million a year ago, and adjusted Property EBITDAR increased to $100.6 million from $77.9 million year-over-year.
The competitive environment in Macau played a significant role in Wynn Resorts' underwhelming results. Despite a 6% increase in operating revenue and a 10% rise in combined mass table and slot wins, Wynn Resorts' EBITDA remained relatively flat at $263 million. The company's strategy to invest in its market-leading assets and five-star service, including enhancing food and beverage programming and improving the loyalty program, is aimed at driving share gains in the long term. However, the current competitive dynamic in Macau requires continued investment and innovation to maintain a strong position in the market.
Wynn Resorts' strategic investments, such as the Wynn Al Marjan Island project, have not significantly impacted its financial performance in the third quarter. The company's operating revenues increased by $21.4 million to $1.69 billion, while Adjusted Property EBITDAR decreased slightly to $527.7 million. Despite these investments, Wynn Resorts' net loss attributable to the company was $32.1 million, compared to a net loss of $116.7 million in the same period last year. The company's CEO, Craig Billings, stated that the investments are expected to support strong long-term free cash flow growth and strengthen the company's position in its markets. However, the company's stock price has fallen due to the miss in profit and sales estimates.
The increased share repurchase authorization to $1 billion signals Wynn Resorts' commitment to returning capital to shareholders. This could potentially boost the stock price through reduced supply and increased earnings per share. However, the recent earnings miss and strategic investments may impact investor sentiment and stock price performance in the short term.
In conclusion, Wynn Resorts' stock price plummeted following a revenue and earnings miss in Q3 2024. The company's strategic investments, competitive environment in Macau, and share repurchase program all play a role in the company's financial performance and stock price. Investors should carefully consider these factors and monitor the company's progress in the coming quarters to make informed decisions about their investments in Wynn Resorts.
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