Wynn Resorts, Limited (WYNN), MGM Resorts International (MGM): Betting on These Casino Stocks Is Safe!

Page 1 of 2

The restricted approval of licenses to establish casino-resorts, limits the expansion possibilities of the companies in the game. But if you do get an approval, new properties can act as a driving force for the future growth of such companies. Keeping this in mind, I thought of analyzing some casino resort stocks to see what future endeavors they are in.

Wynn Resorts, Limited (NASDAQ:WYNN)

Wynn Resorts, Limited (NASDAQ:WYNN)

In mid-2012, Chinese regulators approved Wynn Resorts, Limited (NASDAQ:WYNN)’s Cotai land concession, thus clearing the way for a ground-breaking of the project. The foundation work on the Cotai project has begun, with an estimated completion by the second quarter of 2013. The entire project should take about 36 months to complete with an estimation of possible opening by the Chinese New Year 2016. This project covers a massive area of 51 acres which includes approximately 1,500 hotel rooms and about 500 table games. Looking at the shifting paradigm of the gambling industry in the future, Cotai, Macau is the place to be. Wynn Resorts, Limited (NASDAQ:WYNN)’s extended presence in the strip is a good step to capture the growing opportunity in the region.

Additionally, the company has also revealed the plans for its property- Wynn Resorts, Limited (NASDAQ:WYNN) Everett worth $1.5 billion. Wynn is in competition with Suffolk Downs to acquire the sole license to establish a gambling destination in Boston in Vegas style. This bid marks the second time the company has tried to enter this market. The project features a hotel with 550 guest suits, a river walk, and boat docks.

Apart from that, some recovery was observed in the last quarter in its Las Vegas property revenue which was up by about 12% and the operating profit was up by about 29% year-over-year. The recovery is expected to continue in the future as well.

Overall as a stock, Wynn Resorts, Limited (NASDAQ:WYNN) seems promising. Although some possible headwinds can be faced by the stock if the lawsuit of its former director, Kazuo Okada against forced buyout materializes in the future.


MGM Resorts International (NYSE:MGM)

The company recently announced its intention to develop an arena in Las Vegas. MGM Resorts International (NYSE:MGM) is planning to open a 20,000-seat indoor arena in partnership with AEG, an operator of many sports venues in the country. The company could spend around $75 million over the arena and it should be operational in 2015. I see this as a positive factor for MGM Resorts International (NYSE:MGM)’s profitability in the longer-term. It could serve as a means to increase the foot-traffic around some of the mid-tier assets in the company’s portfolio that are facing trouble in gaining momentum in the Vegas recovery.

On a different note, the company is competing with Penn National Gaming to build a casino resort in Springfield, Massachusetts. The company has proposed an $850 million property in downtown Springfield. If materialized this property could bring up to eight million visitors annually. Absence of any other major competition in the region could prove to be an added advantage to the property in the future. The company has been favored by organizations like NACC, fire and police unions that make it more favorable contender than Penn.

Additionally, MGM Resorts International (NYSE:MGM) China – a subsidiary of the company, has announced that in addition to the special dividend of $500 million, the company will also declare a semi-annual dividend not to exceed 35% of its anticipated annual profits. It provides MGM Resorts International (NYSE:MGM) with a stable stream of cash inflow as it owns 51% of the company that will further bolster the company’s balance sheet.


Las Vegas Sands Corp. (NYSE:LVS)

Major contribution of this company comes from the Macau region, where it operates four different properties. The region saw some weakness in the VIP segment, but MGM Resorts International (NYSE:MGM)’s new arena in Las Vegas Sands Corp. (NYSE:LVS) should help stabilize the profitability of the region. The rough patch seems to be over and the company is regaining its strength. Besides Macau, the company is also planning to expand its operations in Europe.

Page 1 of 2

Biotech Insider Alert - $6 Stock To Hit $40

$200 Million Dollar Healthcare Hedge Fund's #1 Best Idea Right Now

The best healthcare hedge fund out there right now is one of the largest shareholders in this biotech stock. The fund returned more than 20% in each of the last 2 years with a virtually fully hedged portfolio, and it's sending out a BUY signal on this biotech stock. Get your FREE REPORT today (retail value of $300)

This is a FREE report from Insider Monkey. Credit Card is NOT required.
Click here to Read Comments
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 74 percentage points in 2.5 years. Our beta is only 1.2 (download a FREE newsletter and see the details inside)

Lists

Best Selling Magazines in the World

Shortest People in History

The Most Celebrated Holidays in the World

Most Expensive Handbag Brands in the World

Top Selling Comic Book Issues of this Century

The Most Powerful Women in Politics

Best Paid DJs

Most Rebellious Female Artists

Best Paid TV Actresses of 2014

Best Paid Actors of 2014

Most Expensive Horses in the World

Tallest People Ever

Most Encouraging Feminist Celebrities

Best Paid Supermodels of 2014

Top 10 Suburbs for Retirement in 2015

10 Wealthiest Cities in America

Top 10 TED Talks for Entrepreneurs

Best TED Talks on Education

25 Most Dangerous Places to Live in America

Top 10 Ski Resorts in the United States – 2014 List

Top 10 Most Remote Places in the World

Most Visited Museums in the United States

Wealthiest Photographers in the World

Most Famous Gay Athletes

The World’s Most Famous Circuses

Best Hair Stylists

Most Popular NASCAR Drivers

The Best Romance Movies of all Time

The Most Wanted Drug Lords

The Oldest Money Managers

The Greatest Directors in the World

Largest Animals in the World

World’s Most Expensive Desserts

Best Selling Comic Books of All Time

A-list Actors who Sabotaged Their Career

Rappers With a College Degree

The Best Jazz Albums of all Time

The Most Influential Jazz Musicians

The World’s Most Famous Photographers

The Best Oscar-Winning Songs

Most Influential Choreographers Ever

Most Expensive Department Stores in the World

The Most Expensive Stolen Paintings in the World

The World’s Most Expensive Teas

Top Oscar Record Holders

The Most Expensive Flowers in the World

Countries With a Booming Film Industry

Most Expensive Cupcakes in the World

Uncommon European Escapes

The Most Stolen Artists in History

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 129% in 2.5 years!! Wondering How?

Download a complete edition of our newsletter for free!