Wynn Macau Earnings: Results Largely in Line, but Lowering Valuation by 3% on Intense Competition

Wynn Macau’s third-quarter results were largely in line with our expectations, but slightly missed market consensus of USD 280 million, with adjusted EBITDA falling 6% from the prior quarter to USD 263 million on weaker nongaming contribution. Although its market share in gross gaming revenue remained largely flat at 12.6% from a quarter ago, it is well below the 14.2% in the first quarter of 2024 and 14.8% in 2019. We maintain our 2024 earnings forecast unchanged, but reducing our 2025-28 revenue and adjusted EBITDA forecasts by 2%-4%, as we believe competitive landscape remains intense in Macao, and some of its Macao peers are aggressively upgrading properties toward more premium offerings. Accordingly, we lower our fair value estimate of Wynn Macau to HKD 8.50 per share from HKD 8.80.