Back in late December 2011, I wrote an article on Seeking Alpha recommending Wynn Resorts (NASDAQ:WYNN). At the time, Wynn Resorts was trading at $105.65/share. I suggested using June 2012 $120.00 call options. Needless to say, this was a great trade.
Currently, Wynn Resorts is trading at $127.27/share. The 52-week range is $101.02 - $172.58.
|52wk high: ||172.58 |
|52wk low: ||101.02 |
|EPS: ||4.88 |
|PE: ||26.10 |
|Div Rate: ||2.00 |
|Yield: ||1.5715 |
|Market Cap: ||12.79 B |
|Volume: ||14.15 M |
Wynn Resorts engages in the development, ownership, and operation of destination casino resorts. The company owns and operates two casino resort complexes in Las Vegas-- the Wynn Las Vegas and Encore at Wynn Las Vegas, with approximately 4,750 hotel rooms and suites; 220 table games; 2,430 slot machines; and 1 poker room in approximately 186,000 square feet of casino gaming space, including a sky casino and private gaming salons.
The question to ponder is if Wynn has run-up too much, and is there any upside left? I believe there is. I still like Wynn Resorts' upside potential more than MGM Resorts (NYSE:MGM), Las Vegas Sands (NYSE:LVS), or most other casino stocks, even though I am still bullish on all of them. When the economy improves, casino stocks perform well too.
I feel confident that Wynn is heading toward $150.00/share relatively soon. The stock is still well off of its 52-week high of $172.58.
On Friday, the stock was halted for trading for about an hour and a half. It was a bizarre day for Wynn. Rumors of a possible Macau deal shot the stop up over $10.00/share at one point in early trading on Friday. Right before the stock resumed trading, it was announced that there was a false filing by Wynn. I initially thought the stock would drop a lot, but it held up extremely well on Friday-- a good sign.
Also on Friday, Steve Wynn, the CEO of the company, announced plans of a casino resort near the New England Patriots home stadium.
Analyst opinion on the price target is varied, but the consensus seems to be $150.00/share. I agree with this, but would not put $170.00/share out of the equation.
Price Target Summary
|Mean Target: ||141.50 |
|Median Target: ||142.50 |
|High Target: ||189.00 |
|Low Target: ||88.00 |
|No. of Brokers: ||22 |
|03-Feb-12 ||Reiterated ||Brean Murray ||Buy ||$161 → $153 |
|05-Jan-12 ||Initiated ||Compass Point ||Sell ||$88 |
|28-Nov-11 ||Upgrade ||Needham ||Hold → Buy ||$145 |
|28-Nov-11 ||Upgrade ||KeyBanc Capital Mkts ||Hold → Buy ||$145 |
|12-Aug-11 ||Upgrade ||Barclays Capital ||Equal Weight → Overweight || |
|19-Jul-11 ||Reiterated ||Barclays Capital ||Equal Weight ||$125 → $160 |
|07-Jul-11 ||Initiated ||Brean Murray ||Buy ||$175 |
|20-Apr-11 ||Reiterated ||Hudson Securities ||Hold ||$129 → $146 |
|20-Apr-11 ||Reiterated ||Deutsche Bank ||Buy ||$141 → $148 |
|11-Feb-11 ||Reiterated ||Barclays Capital ||Equal Weight ||$102 → $105 |
To summarize, I recommend holding any call options you still have and purchasing more on any daily pullback. If you have not yet initiated a position, I would start out by purchasing June 2012 $135.00 call options.
Disclosure: I am long WYNN.