Monday, October 11, 2010

NASDAQ 100 - Wynn Resorts - WYNN

Wynn Resorts Limited (WYNN) and its wholly-owned subsidiaries Wynn Las Vegas and Wynn Capital will own and operate Le Reve, which they've designed to be the preeminent luxury hotel and destination casino resort in Las Vegas. Le Reve will be situated at the site of the former Desert Inn & Casino on the Las Vegas Strip in Las Vegas, Nevada. 

It would be a major mistake to only think of Wynn as a Las Vegas property and a main target of Prez Obama's Nevada hit list.  Fully 60% of their revenue comes from their properties in Macau and the newly rich and super rich of the Asian realm are flocking there in major numbers.  The revenue at the Macau property doubled year over year and seemed to have double digit month over month growth rates projected.

Asia is recovering faster than the rest of the world and Macau is prospering.

Wall Street looks for revenue to be up 29.00% this year and 7.20% next year.  Since the real growth is not in hotel and food sales but gambling these increases fall to the bottom line.  Analysts expect EPS growth of 515.40% this year, 33.10% next year and 24.48% annually for the next 5 years.

Barchart has a 100% technical buy signal with the stock trading around 97.17 well above its 50 day moving average of 88.60.  The stock was up 8.57% last month and has a rising Relative Strength Index of 63.99%.

The general investor is starting to find this stock and the CAPS members on Motley Fool vote 759 to 342 that the stock will out perform the market.  The All Stars have a similar vote of 202 to 103. Out of the last 16 articles about the company only one has been negative but since that was written by Citi all the way back in 2008 I think it should be discounted.

The stock has promise if:
  • You are looking for a China play in the luxury services to the newly rich in China
  • The double digit monthly growth rates continue
  • You like a price rise that is consistent
Jim Van Meerten is an advisor to Marketocracy Capital Management who uses his model portfolios not only to manage their mutual funds but also their clients Separately Managed Accounts. You can read his blogs about those model portfolios and investing here and on Barchart Portfolio Blogs. Please leave a comment below or email JimVanMeerten@gmail.com.


Disclosure: I have no interest in this stock at the time of publication

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