Wynn Resorts (WYNN) reported their second quarter earnings last night much to the chagrin of investors. It was a mess. Truly abysmal. Essentially, the company missed guidance and consensus estimates across the board. Things do not bode well for the company going forward. We would sit back on the sidelines and wait. Here’s why:
-Even taking into account Wynn’s poor luck at the tables, their results would have still missed consensus estimate. That said, investors were expecting a miss, so we’re not surprised that the stock is having a small relief rally. Also helps that the market is up today.
-Given the challenging fundamentals ahead in Macau for Wynn (ie more competition with Sands Cotai Central’s full opening, anticipation for further slowdown in VIP, China Macro headwinds), lackluster data coming out of Vegas, and the Okada overhang; we would take profits here.