NEW YORK (TheStreet) -- Shares of Wynn Resorts Ltd. (WYNN) are down by 0.78% to $183.84 in pre-market trading on Monday, following a ratings downgrade to "market perform" from "outperform" at Wells Fargo.
The firm said it lowered its rating on the casino owner and operator as it believes the gaming industry will be facing negative catalysts in upcoming quarters.
Wells Fargo cut its price target range on Wynn Resorts to $180-$200 from $245-$250.
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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 few notable 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 5.5%. 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.
- Looking at where the stock is today compared to one year ago, we find that it is not only higher, but it has also clearly outperformed the rise in the S&P 500 over the same period. Although other factors naturally played a role, the company's strong earnings growth was key. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen 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 ($8.46 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