WYNN: LOW HOLD IMPACTING SHARE

From our understanding, Wynn is holding only around 2.6% thus far in August, which explains some of the sequential market share loss.

 

 

We continue to think the Macau narrative for Wynn may soon turn to Encore and the seemingly lack of incremental contribution from the sister property.  Market share will likely be a focus.

 

In July, the Wynn properties posted a disappointing market share of 15%, the lowest full month share since Encore opened in April.  Through the 8/15, Wynn's share fell further, to only 12.8%.  By contrast, Wynn's June market share was 17.4% and averaged 14.2% in the 12 months prior to Encore opening.

 

Our sources indicated that Wynn's August hold % fell to 2.6%, below a Wynn's average hold of of 3% since 2007.  We calculate that if Wynn's hold was 3%, its market share would have been 14% in the first half of August.  14% is not good enough either.

 

We recognize that we don't have the data yet to normalize everyone's share so this analysis is not as useful as it could be.  However, what is clear is that Wynn is on track to post its second straight month of disappointing market share with Encore.  Given the overall market strength, this may not matter but at some point, overall growth will slow and market share will become a more important metric in the eyes of investors.  At that point, a narrative of disappointing ROI from Encore may be the story that will start to be told.