Steren Agee analyst Dave Bain downgraded Wynn’s rating to neutral after a 46 percent rise in the share price over the past month, and citing Wynn’s vulnerability to VIP bettors in Macau.
The Wynn Palace Macau recently opened, spurring the rise in Wynn’s share price, but the Macau gaming market has been soft over the past year, Bain said.
Bain estimates Wynn will post $1.1 billion in EBITDA for the year and $1.5 billion next year, pushing expected earnings from $2.23 per share in 2016 to $5.07 next year. But it has some $16 billion in debt, which Bain cited as a concern.
While Bain downgraded Wynn, Boyd Gaming’s improved credit outlook merited a rating upgrade by Fitch analyst Alex Bumazhny, who improved its Boyd’s rating from “stable” to “positive.”
He said further ratings upgrades are likely if Boyd continues reducing its debt.
