Wynn Resorts
WYNN
$107.27
-0.45%
Wynn Resorts Ltd is a global operator of luxury integrated casino resorts, primarily in the high-end gaming and hospitality markets of Macau and Las Vegas, with a growing presence in Massachusetts and a planned development in the United Arab Emirates. The company is a premier player in the luxury casino and resort segment, known for its high-quality properties and brand prestige, which allows it to command premium pricing and attract affluent clientele. The current investor narrative is heavily focused on the recovery and growth trajectory of its Macau operations, which historically contributed a significant portion of EBITDA, and the successful ramp-up of its newer property, Encore Boston Harbor, while also anticipating the future catalyst of its UAE project slated for 2027. Recent financial trends and news highlight a market sensitive to macroeconomic factors like inflation and interest rates, which influence consumer discretionary spending on travel and gaming.…
WYNN
Wynn Resorts
$107.27
Investment Opinion: Should I buy WYNN Today?
Rating: Hold. The core thesis is that while the stock is undervalued based on forward earnings estimates and analyst targets, near-term execution risks from margin compression and decelerating growth warrant caution, making it a 'show me' story rather than a clear buy.
Supporting Evidence: The stock trades at a forward P/E of 19.2x, a discount to its trailing P/E of 38.1x, implying the market expects significant earnings growth. Analyst consensus is a 'Buy' with an average target price of ~$118.85, offering 14.7% upside. However, Q4 revenue growth decelerated to 1.48% YoY, and net margin compressed from 15.06% to 4.59% year-over-year, casting doubt on the achievability of forward EPS estimates of $6.19. Strong TTM FCF of $692.2 million provides financial flexibility.
Risks & Conditions: The two biggest risks are 1) further gross margin deterioration below 30%, and 2) a stagnation or decline in Macau revenues. This Hold rating would upgrade to a Buy if QoQ gross margins show sequential improvement back above 35% or if revenue growth re-accelerates above 5% YoY. It would downgrade to a Sell if the stock breaks below its 52-week low of $82.63 on worsening fundamentals. Relative to its own volatile history and the anticipated recovery, the stock appears fairly valued, pricing in a recovery that is not yet evident in recent results.
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WYNN 12-Month Price Forecast
The investment case is balanced on a knife's edge between compelling forward valuation and deteriorating recent fundamentals. The market is pricing in a robust earnings recovery (forward P/E 19.2x vs. trailing 38.1x), but Q4 results showed alarming margin weakness. The stance is neutral due to this disconnect; the path of margins over the next two quarters is the critical swing factor. Upward momentum is contingent on evidence of operational improvement, while further margin erosion would likely trigger a downgrade to bearish. The high analyst conviction suggests the downside may be limited near-term, but the burden of proof is squarely on management.
Wall Street consensus
Most Wall Street analysts maintain a constructive view on Wynn Resorts's 12-month outlook, with a consensus price target around $139.45 and implied upside of +30.0% versus the current price.
Average Target
$139.45
10 analysts
Implied Upside
+30.0%
vs. current price
Analyst Count
10
covering this stock
Price Range
$86 - $139
Analyst target range
The stock is covered by 10 analysts, and the institutional ratings data shows a uniformly bullish sentiment, with recent actions from firms like Morgan Stanley, UBS, Mizuho, Stifel, Wells Fargo, and Macquarie all maintaining 'Buy', 'Overweight', or 'Outperform' ratings. The consensus recommendation is a 'Buy', and based on the provided EPS estimates, the average target price implied by the average EPS estimate of $6.19 and the forward PE of 19.2x is approximately $118.85, representing a potential upside of about 14.7% from the current price of $103.60. The target range is derived from the estimated EPS range of $5.35 (low) to $7.39 (high), implying price targets from roughly $102.50 to $141.70 using the forward PE multiple; the high target assumes the company achieves superior earnings growth and potentially multiple expansion, while the low target reflects concerns about margin pressure or a slower-than-expected Macau recovery. The tight clustering of recent analyst actions (all reiterations) and the lack of downgrades suggests strong institutional conviction in the company's near-term outlook, though the wide implied target range indicates some uncertainty around the magnitude of the earnings recovery.
Bulls vs Bears: WYNN Investment Factors
The bull case, supported by unanimous analyst conviction and a discounted forward P/E, is currently outweighed by the bearish evidence of severe margin compression and decelerating growth. The single most important tension in the investment debate is whether the anticipated earnings recovery (implied by the forward P/E of 19.2x) will materialize to offset the recent, sharp deterioration in profitability. If margins stabilize and Macau recovers, the stock offers significant upside. If margin pressure persists, the forward earnings estimates are at risk, and the stock's premium valuation is unjustified.
Bullish
- Strong Analyst Conviction & Upside: All 10 covering analysts maintain a Buy or equivalent rating, with an average target price of ~$118.85 implying 14.7% upside from the current price. The high EPS estimate of $7.39 suggests a bull-case target near $142, representing over 37% potential upside.
- Robust Free Cash Flow Generation: The company generates substantial TTM free cash flow of $692.2 million, providing strong liquidity to service its debt and fund dividends. This operational strength is a key buffer against its high leverage, as evidenced by a healthy current ratio of 1.63.
- Attractive Forward Valuation: The forward P/E of 19.2x is nearly half the trailing P/E of 38.1x, indicating the market is pricing in a significant earnings recovery. This forward multiple is based on an average EPS estimate of $6.19, suggesting a reasonable valuation for a premium brand in recovery.
- Macau Recovery & Future Catalysts: The core investment narrative hinges on the continued recovery of the high-margin Macau segment, which historically contributed 49% of pre-pandemic EBITDA. The planned UAE resort opening in 2027 provides a tangible long-term growth catalyst beyond the current recovery cycle.
Bearish
- Severe Profitability Compression: Gross margin collapsed from 43.68% in Q4 2024 to 31.96% in Q4 2025, driving net margin down from 15.06% to 4.59%. This dramatic margin erosion, despite a slight revenue increase, indicates significant cost pressures or a negative mix shift that threatens earnings quality.
- Revenue Growth Deceleration: Q4 2025 revenue growth slowed to just 1.48% YoY, a sharp deceleration from the stronger growth seen earlier in 2024. This suggests the post-pandemic recovery may be plateauing, raising questions about the sustainability of top-line momentum needed to justify the forward multiple.
- Extreme Leverage & Negative Equity: The company has a negative debt-to-equity ratio of -44.6, reflecting significant leverage and negative shareholder equity. While common for casino operators, this financial structure amplifies risk if operational performance falters, as seen in the recent margin compression.
- Persistent Technical Downtrend: The stock is down 17.5% over six months and 15.5% YTD, severely underperforming the S&P 500 by 27.9% and 26.5%, respectively. Trading at 77% of its 52-week high, the price action reflects deep skepticism about the near-term earnings recovery priced into the forward multiple.
WYNN Technical Analysis
The stock is in a pronounced downtrend, having declined 17.46% over the past six months and 15.48% year-to-date, significantly underperforming the broader market which is up 10.41% and 11.02% over the same periods, respectively. Currently trading at $103.60, the price sits at approximately 77% of its 52-week high of $134.72 and 125% above its 52-week low of $82.63, indicating it is in the lower half of its annual range and suggesting potential oversold conditions or a lack of positive momentum. The short-term momentum shows a slight divergence, with a 1-month decline of 2.48% and a 3-month gain of 1.96%, hinting at a possible stabilization or consolidation phase after the steeper earlier declines, though the stock's 1-year relative strength of -6.77% versus the S&P 500 confirms persistent weakness. Key technical support is anchored at the 52-week low of $82.63, while immediate overhead resistance is at the 52-week high of $134.72; a sustained break below the $100 psychological level could signal a test of the 52-week low, whereas a move above the recent high near $127 would be needed to suggest a trend reversal. With a beta of 1.007, the stock exhibits market-like volatility, but its significant underperformance (a 6-month relative strength of -27.87%) indicates it carries substantial idiosyncratic risk, likely tied to its specific operational and regional exposures.
Beta
0.98
0.98x market volatility
Max Drawdown
-28.9%
Largest decline past year
52-Week Range
$83-$135
Price range past year
Annual Return
+23.2%
Cumulative gain past year
| Period | WYNN Return | S&P 500 |
|---|---|---|
| 1m | +11.5% | -0.1% |
| 3m | +6.8% | +12.0% |
| 6m | -13.3% | +8.8% |
| 1y | +23.2% | +22.9% |
| ytd | -12.5% | +8.8% |
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WYNN Fundamental Analysis
Revenue growth has been modest but positive, with Q4 2025 revenue of $1.866 billion representing a 1.48% year-over-year increase; however, this marks a deceleration from the stronger growth seen in prior quarters of 2024, such as Q1 2024's $1.863 billion, suggesting a potential plateau in the post-pandemic recovery phase. The company is profitable, reporting Q4 2025 net income of $100 million and a net margin of 4.59%, but profitability has compressed significantly from the year-ago quarter's net margin of 15.06%, driven by a gross margin decline from 43.68% in Q4 2024 to 31.96% in Q4 2025, indicating rising costs or a less favorable revenue mix. The balance sheet shows a negative debt-to-equity ratio of -44.62, a result of negative shareholder equity, which is common for highly leveraged casino operators, but the company generates substantial free cash flow, with TTM FCF of $692.2 million, providing liquidity to service debt and fund dividends, as evidenced by a current ratio of 1.63 and a healthy FCF yield relative to its market cap. Segment data from the latest quarter shows the Casino segment remains the dominant revenue driver at $1.143 billion, followed by Rooms (Occupancy) at $305 million, Food and Beverage at $265 million, and Entertainment/Retail at $153 million, highlighting its core reliance on gaming activity.
Quarterly Revenue
$1.9B
2025-12
Revenue YoY Growth
+0.01%
YoY Comparison
Gross Margin
+0.31%
Latest Quarter
Free Cash Flow
$692220000.0B
Last 12 Months
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
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Valuation Analysis: Is WYNN Overvalued?
Given the company's positive net income, the primary valuation metric is the Price-to-Earnings (PE) ratio. The trailing twelve-month PE ratio stands at 38.1x, while the forward PE is significantly lower at 19.2x, indicating the market expects a substantial near-term earnings recovery, with forward EPS estimates averaging $6.19. Compared to sector averages, Wynn's forward PE of 19.2x is at a premium to many traditional consumer cyclical peers, but this premium is often justified for high-quality casino operators with exposure to the recovering Macau market and strong brand positioning; however, the exact industry average PE is not provided in the data for a precise comparison. Historically, the stock's own trailing PE has fluctuated wildly, from as low as 3.5x in late 2023 to over 255x in early 2023; the current 38.1x is above the median of its recent historical range (based on provided quarterly data), suggesting the market is pricing in a robust earnings rebound, leaving little room for disappointment.
PE
38.1x
Latest Quarter
vs. Historical
Mid-Range
5-Year PE Range -82x~256x
vs. Industry Avg
N/A
Industry PE ~N/A*
EV/EBITDA
13.2x
Enterprise Value Multiple
Investment Risk Disclosure
Financial & Operational Risks: Wynn's financial risk is dominated by its highly leveraged balance sheet, with a negative debt-to-equity ratio of -44.6 and negative shareholder equity. While strong TTM FCF of $692.2 million provides a liquidity cushion, the recent collapse in gross margin from 43.7% to 32.0% (Q4 YoY) introduces significant earnings volatility and raises execution risk. The company's reliance on the high-end, discretionary Macau market (historically 49% of EBITDA) creates revenue concentration risk, making it vulnerable to regional economic or regulatory shifts.
Market & Competitive Risks: The stock trades at a forward P/E of 19.2x, a premium to many consumer cyclical peers, leaving it exposed to valuation compression if the earnings recovery falters. With a beta of 1.007, it has market-like volatility, but its severe 6-month underperformance of -27.9% relative to the S&P 500 indicates substantial idiosyncratic risk tied to its specific operational challenges. Recent news highlights sensitivity to macroeconomic factors like inflation and interest rates, which directly impact discretionary spending on luxury travel and gaming.
Worst-Case Scenario: The most damaging scenario involves a failure of the Macau recovery to materialize, coupled with sustained margin pressure in Las Vegas and rising interest expenses on its debt. This could lead to a significant earnings miss, triggering analyst downgrades and a derating of the forward multiple. Realistic downside could see the stock re-testing its 52-week low of $82.63, representing a potential loss of approximately -20% from the current price of $103.60. A breach of that level could trigger further technical selling.
FAQ
The key risks are, in order of severity: 1) Financial Risk: Extreme leverage with negative shareholder equity (Debt/Equity of -44.6) amplifies losses if operations weaken. 2) Operational Risk: Severe profitability compression, with gross margin falling 1172 basis points YoY to 31.96% in Q4 2025. 3) Macro/Geographic Risk: Heavy reliance on the discretionary Macau market, which is sensitive to Chinese economic policy and travel patterns. 4) Valuation Risk: The stock's premium forward P/E of 19.2x could compress sharply if the anticipated earnings rebound is delayed or falls short of estimates.
The 12-month forecast is scenario-dependent. The base case (50% probability) sees a gradual recovery, with a price target range of $115-$120, aligning with the analyst average target. The bull case (30% probability) assumes a strong margin and Macau rebound, targeting $135-$142. The bear case (20% probability) involves stalled growth and margin pressure, targeting a retest of the 52-week low, around $82-$95. The most likely outcome is the base case, hinging on the assumption that the company can stabilize margins near current levels and achieve consensus EPS estimates, allowing the stock to grind higher towards analyst targets.
WYNN's valuation is bifurcated. Based on trailing earnings (P/E of 38.1x), it appears expensive. However, the market is forward-looking, pricing the stock at a forward P/E of 19.2x based on expected EPS of $6.19. This forward multiple suggests the stock is fairly valued or slightly undervalued if the earnings recovery materializes, but it is not deeply discounted. The valuation implies the market expects a near-doubling of earnings power and a stabilization of recently collapsed margins. Compared to its own historical P/E range (which has been extremely volatile), the current forward multiple is reasonable, but it carries significant execution risk.
WYNN presents a nuanced risk/reward. It is a good buy for investors with a higher risk tolerance who believe the company's severe margin compression in Q4 2025 is temporary and that the Macau recovery will accelerate. The 14.7% upside to the average analyst target of ~$118.85 is attractive, and the stock is technically oversold, down 17.5% over six months. However, it is not a good buy for conservative investors, as the bear case involving further margin pressure and a test of the 52-week low at $82.63 represents a -20% downside risk. The investment requires conviction in a near-term operational turnaround.
WYNN is more suitable for a medium-term investment horizon of 12-24 months, aligning with the expected timeline for the Macau recovery narrative to play out and for the UAE project to become a nearer-term catalyst. It is less suitable for long-term 'buy and hold' due to its cyclicality and high leverage, and it is risky for short-term trading due to its volatility (beta 1.007) and sensitivity to quarterly earnings and margin reports. Investors should be prepared to monitor quarterly results closely, as the thesis is highly dependent on demonstrating sequential operational improvement.