NEW YORK (TheStreet) -- Wynn Resorts (WYNN) shares are down -1.1% to $198.19 on Tuesday after analysts at Morgan Stanley (MS) lowered their 2014 and 2015 Macau gaming revenue growth estimates.
The firm lowered its expectations to 6% growth this year and 11% growth next year from its previously expected revenue growth of 12% and 12.5%, respectively.
Despite grim expectations for the gaming industry's overseas enclave in Macau, the firm is bullish on the industry's domestic prospects.
"Market participants in Vegas reiterated our confidence that the YTD strength should continue in 2H/'15. Room nights are trending up y/y for the next 4 quarters, including the difficult 1Q15 comp when we lap Con/Agg (lots of smaller, more profitable shows offsetting)," analysts wrote in a research note.
Separately, TheStreet Ratings team rates WYNN RESORTS LTD as a "buy" with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:
"We rate WYNN RESORTS LTD (WYNN) a BUY. This is driven by a number of strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its notable return on equity, revenue growth, solid stock price performance, impressive record of earnings per share growth and compelling growth in net income. We feel these strengths outweigh the fact that the company shows weak operating cash flow."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- Compared to other companies in the Hotels, Restaurants & Leisure industry and the overall market, WYNN RESORTS LTD's return on equity significantly exceeds that of both the industry average and the S&P 500.
- The revenue growth came in higher than the industry average of 5.6%. Since the same quarter one year prior, revenues slightly increased by 6.0%. Growth in the company's revenue appears to have helped boost the earnings per share.
- Powered by its strong earnings growth of 56.25% and other important driving factors, this stock has surged by 44.21% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, although almost any stock can fall in a broad market decline, WYNN should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
- WYNN RESORTS LTD reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, WYNN RESORTS LTD increased its bottom line by earning $7.17 versus $4.81 in the prior year. This year, the market expects an improvement in earnings ($8.59 versus $7.17).
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Hotels, Restaurants & Leisure industry. The net income increased by 57.1% when compared to the same quarter one year prior, rising from $129.79 million to $203.91 million.
- You can view the full analysis from the report here: WYNN Ratings Report
EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he and Stephanie Link think could be potentially HUGE winners. Click here to see the holdings for FREE.