The first-quarter results from the two players showed the strength of international gaming, as well as a recovery domestically.
Wynn reported a nearly six-fold surge in its profit, boosted by its Macau casinos. Overall, Wynn Resorts earned $173.8 million, or $1.39 a share, compared with $27 million, or 22 cents, in the year-ago period. Analysts were calling for a much smaller profit of 73 cents a share.
Revenue jumped 39% to $1.26 billion, also better than Wall Street's estimates of $1.15 billion.In Macau, profit jumped 66% to $189.7 million, from $114.3 million, while revenue grew 47% on strong growth at VIP tables and slot machines. These results were boosted by the opening of Encore Macau in April 2010. Revenues from the resort were not included in 2010 results. Las Vegas also showed steps toward a turnaround, with Wynn's revenue in Sin City rising 24%, as the company got luckier than expected in table games. Penn National's first-quarter topped expectations, and the regional casino operator issued second-quarter and full-year outlooks above consensus estimates. For the three-month period the company earned $178 million, or 48 cents a share, above analysts' outlook of 41 cents. Revenue rose nearly 13% to $667 million, better than the $664.4 million Wall Street forecast. Looking ahead, Penn foresees second-quarter earnings of 47 cents a share, compared with the 41 cents from analysts. For the full-year it is calling for a profit of $1.64 a share, also better than estimates of $1.53. "We think Penn's solid first-quarter results speak to the rational promotional and comping environment across most regional gaming markets, allowing for the regional casinos to generate stronger profitability and improved EBITDA margins," J.P. Morgan analyst Joseph Greff, wrote in a note. Now the question is, will rival casino giants be able to post the same winnings? Click on for a company-by-company look at how the rest of the sector is expected to fair when it reports earnings over the next several weeks....
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