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I still expect WYNN’s quarter to look ugly and numbers to come down. However, WYNN’s stock is down 38% year-to-date and there are a couple of catalysts. Not necessarily long catalysts, but catalysts to potentially halt this precipitous stock decline.

As WYNN indicated on Tuesday’s pre-announcement conference call to announce they weren’t pre-announcing earnings yet, the company has some cost levers to pull. Management identified $75-100 million in labor cost savings. Second, the high margin Mass Market business is actually growing, albeit slowly in Macau, and Wynn Macau has, temporarily at least, reversed its recent market share erosion. January is only one month but the Mass Market has held up well despite the tighter visa restrictions.

Wynn Macau is tracking below our estimate for RC revenue in Q1 but above for MM. This is a decent trade off since MM is much higher margin. See today’s post “MACAU: JAN COULD’VE BEEN WORSE” for a more detailed analysis of Macau’s recent performance.

WYNN’s balance sheet is pristine which is highly unusual in this industry. PENN is the only other gaming operator with sub 3x leverage. The longer term outlook for Macau remains favorable, particularly if Beijing loosens visa restrictions ahead of the new Macau Chief Executive taking over later this year, as we expect.

We realize this isn’t exactly a bull thesis on the stock but it’s not a bearish one any more either.