Analysts at Bank of America/Merrill Lynch downgraded Wynn Resorts (WYNN) from a Buy to a Neutral. Shares of Wynn fell 0.89% in Tuesday’s pre-market trading. The price target was reduced from $210 to $195 because of increasing uncertainty of the future of the gambling in Macau. Wynn Resorts has significant exposure to Macau, a haven for gambling in Asia, since the pastime is not allowed in mainland China. However, the Chinese government has cracked down on gambling even in Macau, which has left many casino companies that saw Macau as a major opportunity outside of Las Vegas with losing bets.
The Street.com still rates Wynn as a Buy with a “B” grade because of its earnings per share growth, return on equity and rise in stock price. However, bears could say these data points are in the rear view mirror, and what matters is the reality in Macau. Contrary to popular misconception, analysts on TheStreet.com frequently are at odds with Jim Cramer, the site’s owner. While Cramer on his CNBC Mad Money program was bullish on Wynn Resorts for some time, he changed his thesis as it became clear that Macau was not going to be as friendly an atmosphere for gambling and Las Vegas seems to be recovering.
Will you offer us a hand? Every gift, regardless of size, fuels our future.
Your critical contribution enables us to maintain our independence from shareholders or wealthy owners, allowing us to keep up reporting without bias. It means we can continue to make Jewish Business News available to everyone.
You can support us for as little as $1 via PayPal at office@jewishbusinessnews.com.
Thank you.
