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In this article, I will feature one casino stock that has seen intensive insider selling during the last 30 days. Intensive insider selling can be defined by the following three criteria:

  1. The stock was sold by three or more insiders within one month.
  2. The stock was not purchased by any insiders in the month of intensive selling.
  3. At least two sellers decreased their holdings by more than 10%.

Wynn Resorts (NASDAQ:WYNN) engages in the development, ownership, and operation of destination casino resorts.

(click to enlarge)

Insider selling during the last 30 days

Here is a table of Wynn Resorts' insider-trading activity during the last 30 days by insider.

NameTitleTrade DateShares SoldRule 10b5-1Current OwnershipDecrease In Ownership
Linda ChenPresident, Wynn International MarketingFeb 610,000No144,600 shares6.5%
John StrzempEVPFeb 45,000No250,500 shares2.0%
Robert MillerDirectorFeb 310,000No2,500 shares80.0%
Matt MaddoxCFOFeb 330,000No73,560 shares29.0%

There have been 55,000 shares sold by insiders during the last 30 days.

Insider selling by calendar month

Here is a table of Wynn Resorts' insider-trading activity by calendar month.

MonthInsider selling / sharesInsider buying / shares
February 201455,0000
January 201400
December 201300
November 201320,0000
October 201310,0000
September 201300
August 201300
July 201300
June 201300
May 2013119,2000
April 20135,0000
March 201300
February 201300
January 201300

There have been 209,200 shares sold, and there have been zero shares purchased by insiders since January 2013.

Financials

Wynn Resorts reported the full-year 2013 financial results on January 30 with the following highlights:

Revenue$5.6 billion
Net income$728.7 million
Cash$2.9 billion
Debt$6.6 billion

Upcoming milestones

Wynn Resorts' upcoming milestones include to launch the Wynn Palace in 22 or 23 months.

(Source: December presentation)

Competition

Wynn Resorts' competitors include Caesars Entertainment Corporation (NASDAQ:CZR), Las Vegas Sands (NYSE:LVS) and MGM Resorts International (NYSE:MGM). Here is a table comparing these companies.

CompanyWYNNCZRLVSMGM
Market Cap:22.08B3.11B62.76B12.13B
Employees:N/A68,000N/A50,050
Qtrly Rev Growth (yoy):0.18-0.030.190.09
Revenue:5.62B8.34B13.77B9.23B
Gross Margin:0.380.490.340.37
EBITDA:1.68B1.76B4.46B1.93B
Operating Margin:0.230.110.250.12
Net Income:728.65M-1.60B2.31B-1.34B
EPS:7.17-13.232.79-2.75
P/E:30.62N/A27.47N/A
PEG (5 yr expected):2.19N/A1.18-8.12
P/S:3.880.364.531.29

Wynn Resorts has the second-highest P/S ratio among these four companies.

Here is a table of these competitors' insider-trading activities during the last 12 months.

CompanyInsider buying / sharesInsider selling / shares
CZR014,434
LVS01,329,356
MGM

0

256,075

Only Wynn Resorts has seen intensive insider selling during the last 30 days.

Conclusion

There have been four different insiders selling Wynn Resorts, and there have not been any insiders buying Wynn Resorts during the last 30 days. Two of these four insiders decreased their holdings by more than 10%. Wynn Resorts has an insider ownership of 20.23%.

Before going short Wynn Resorts, I would like to get a bearish confirmation from the Point and Figure chart. The main reason for the proposed short entry is the intensive insider-selling activity.

Source: Wynn Resorts: 4 Different Insiders Have Sold Shares This Month