Stock To Watch: Wynn Resorts (WYNN) In Perilous Reversal

Trade-Ideas LLC identified Wynn Resorts ( WYNN) as a "perilous reversal" (up big yesterday but down big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Wynn Resorts as such a stock due to the following factors:

  • WYNN has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $245.2 million.
  • WYNN has traded 789,676 shares today.
  • WYNN is down 3.1% today.
  • WYNN was up 6.2% yesterday.

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More details on WYNN:

Wynn Resorts, Limited, together with its subsidiaries, develops, owns, and operates destination casino resorts. It operates in two segments, Macau Operations and Las Vegas Operations. The company operates Wynn Macau and Encore at Wynn Macau resort located in the People's Republic of China. The stock currently has a dividend yield of 2%. WYNN has a PE ratio of 31. Currently there are 4 analysts that rate Wynn Resorts a buy, 1 analyst rates it a sell, and 9 rate it a hold.

The average volume for Wynn Resorts has been 2.6 million shares per day over the past 30 days. Wynn has a market cap of $9.9 billion and is part of the services sector and leisure industry. The stock has a beta of 1.82 and a short float of 28.6% with 3.98 days to cover. Shares are up 49.5% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Wynn Resorts as a hold. The company's strengths can be seen in multiple areas, such as its increase in net income, good cash flow from operations and expanding profit margins. However, as a counter to these strengths, we find that the stock has had a generally disappointing performance in the past year.

Highlights from the ratings report include:
  • 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 268.6% when compared to the same quarter one year prior, rising from -$44.60 million to $75.22 million.
  • Net operating cash flow has significantly increased by 868.48% to $115.37 million when compared to the same quarter last year. In addition, WYNN RESORTS LTD has also vastly surpassed the industry average cash flow growth rate of 5.09%.
  • WYNN RESORTS LTD reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, WYNN RESORTS LTD reported lower earnings of $1.93 versus $7.17 in the prior year. This year, the market expects an improvement in earnings ($3.64 versus $1.93).
  • WYNN, with its decline in revenue, underperformed when compared the industry average of 10.3%. Since the same quarter one year prior, revenues slightly dropped by 8.7%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
  • WYNN has underperformed the S&P 500 Index, declining 7.43% from its price level of one year ago. Looking ahead, other than the push or pull of the broad market, we do not see anything in the company's numbers that may help reverse the decline experienced over the past 12 months. Despite the past decline, the stock is still selling for more than most others in its industry.

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