Wynn Resorts Ltd. (NASDAQ: WYNN) is scheduled to release its financial results for fourth quarter 2009 after the closing bell on Tuesday, February 23, 2010. Analysts, on average, expect the company to report earnings of 12 cents per share on revenue of $784.68 million. For the fourth quarter of the previous fiscal, the company reported earnings of 7 cents per share on revenue of $614.28 million.Wynn Resorts, Limited, together with its subsidiaries, engages in the development, ownership, and operation of destination casino resorts. It owns and operates three destination casino resorts: Wynn Las Vegas, on the Strip in Las Vegas, Nevada, Encore at Wynn Las Vegas located adjacent to Wynn Las Vegas, and Wynn Macau, located in the Macau Special Administrative Region of the People’s Republic of China (Macau).
Like other casino operators, Wynn Resorts suffered as severe economic crunch forced consumers and business to slash travel spending. In the preceding third quarter, the Las Vegas, Nevada-based company reported that its third-quarter net income slumped to $34.21 million or $0.28 per share, from $51.2 million or $0.49 per share, in the comparable quarter last year. On an adjusted basis, the company earned $39.93 million or $0.33 per share, compared to $64.31 million or $0.62 per share, in the year-earlier quarter. Sales rose to $773.07 million from $769.19 million in the prior-year period. Consensus expectations were for the company to report earnings of $0.11 per share on sales of $743.05 million.
However, recent indications have suggest that overall business is improving and improved investor confidence is returning in the recession hit sector. Recently, Nevada’s Gaming Control Board said that the Las Vegas Strip gambling revenue rose 5.9 percent in December, the second straight monthly gain. Strip proceeds climbed to $502.2 million in December from a year earlier.
Meanwhile, the company is also primed to benefit from an increase in Macau gambling revenue. The prospects of Macau casino operators have been boosted by friendly gaming policies from the local government, limited supply of new gaming tables in the near term, and expectation of no further strict enforcement by the Chinese government over tourist visitations to the enclave support stable growth for the sector's revenues. According to Portuguese news agency Lusa, casino revenue in Macau surged almost 65 percent to a monthly record of 14 billion patacas ($1.75 billion) in January from a year ago, beating the 12.6 billion patacas recorded for October 2009. A new daily record of more than 800 million patacas was also reached in January, Lusa said, citing data from the casino operators. With a market share of about 15%, Wynn Resorts is the third largest casino operator at Macau.
However, it appears that the stock's value has gotten ahead of itself. The company's stock currently trades at a forward P/E (fye 31-Dec-10) of 107.22 and PEG (5 yr expected) of 27.52. In terms of stock performance, Wynn shares have gained nearly 143% over the pst year.
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