The shares of Wynn Resorts, Limited (NASDAQ:WYNN) have opened this week on a positive note, gaining as much as 5.95% in morning trading today and currently trading up by 4.43% on the day. The primary reason for this boost is the latest speculation that the Chinese government outlook over the smoking rooms on gaming floors in Macau may be easing. The shares of Wynn Macau Ltd., a subsidiary of Wynn Resorts, Limited (NASDAQ:WYNN), were up by 5.7% as of the reporting period. According to a government official, the government might allow casinos to run smoking rooms if they can scientifically prove the safety of their employees and patrons against the effects of tobacco smoke (one would assume however that this will be difficult, given the mounds of data to the contrary).
While discussing the regulations, Alexis Tam Chon Weng, the secretary of social affairs and culture, said, “Some legislators seem very confident about establishing smoking lounges that can scientifically and effectively prevent the health of gaming workers and tourists from being affected by tobacco.” This could be excellent news for casinos and game operators in Macau, as the city struggles to keep up its gaming revenue. The casino revenue in the region declined by 36.2% in June 2015 to $2.17 billion on a monthly basis and the revenues were down by 37.4% in the second quarter of 2015.
In addition to this announcement, the local authorities relaxed the tourist stay guidelines for Macau earlier this month, including allowing travelers with Chinese passports to stay in the city for seven days compared to the previous limit of five days. The shares of Wynn Resorts, Limited (NASDAQ:WYNN) are down by 27.19% year-to-date. However, smart money has a positive outlook on the company. Out of the 730 hedge funds that we track at Insider Monkey, 25 managers have invested $936.81 million in the gaming company against investments of $878.66 million three months earlier. The increase in the value of smart money’s holdings is even more notable when you consider that the stock lost 15.5% of its value during that time.
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The insiders at Wynn Resorts, Limited have joined hands with the hedge fund managers in terms of boosting their investments in the company. Insiders are bullish, with John Hagenbuch, Director at Wynn Resorts, buying 5,850 shares of the company on May 6, 2015.
Positive hedge fund sentiment often indicates growth potential in upcoming months, so keeping this in mind we’re going to analyze the detailed hedge fund action surrounding Wynn Resorts, Limited (NASDAQ:WYNN).