’Reddit is built for this moment’ - Stock soars on crushed earnings
On Wednesday, BofA Securities announced an upgrade in the stock rating of Wynn Resorts (NASDAQ:WYNN), shifting from Neutral to Buy, and increased the price target to $100 from the previous $90. Currently trading at $83.52, the stock has strong analyst support, with a consensus "Buy" rating and targets ranging from $83 to $132. According to InvestingPro analysis, the company shows promising fundamentals. The decision by BofA Securities comes in anticipation of the opening of Wynn Al Marjan Island, which is set to become the first major integrated casino resort in the Middle East, with doors opening in early 2027.
The analysts at BofA Securities expressed optimism about the impact of the upcoming Wynn Al Marjan Island on investor sentiment and the company’s financial projections. They believe that this development will begin to significantly influence investor expectations and the company’s valuation in the coming 12 to 18 months.
Wynn Resorts has experienced a recent decline in its stock value, with a 20% drop since October. Supporting BofA’s positive outlook, InvestingPro data reveals an impressive 11% free cash flow yield and strong financial health with a 1.9 current ratio, indicating solid liquidity. These metrics, along with the company’s $7.13 billion in revenue, suggest robust fundamentals that help mitigate risks associated with its operations in China and Macau. These concerns have been a major point of consideration for the firm.
BofA Securities anticipates that the expansion into the United Arab Emirates (UAE) will not only contribute to Wynn Resorts’ growth but will also diversify the company’s portfolio away from its reliance on the Macau market. This strategic move is expected to re-establish the premium valuation Wynn Resorts once held.
In their statement, BofA Securities analysts concluded that the increase in their price objective to $100 reflects the added value from the UAE venture and an adjustment to the forecast period extending into 2026. The upgrade and new price target suggest a positive outlook for Wynn Resorts as it prepares for its expansion into the Middle East. InvestingPro analysis indicates the stock is currently undervalued, with additional insights available in the comprehensive Pro Research Report, which provides deep-dive analysis of this and 1,400+ other US stocks.
In other recent news, Wynn Resorts reported its financial results for the first quarter of 2025, which did not meet market expectations. The company revealed earnings per share (EPS) of $1.07, falling short of analysts’ forecasts of $1.31, and revenue of $1.7 billion, below the projected $1.75 billion. Despite the earnings miss, Citi analyst George Choi raised the price target for Wynn Resorts to $101, up from $97, and maintained a Buy rating on the stock. Choi highlighted the performance of Wynn Las Vegas, noting a smaller-than-expected decline in EBITDA despite challenges from the Super Bowl and a year-over-year increase in casino revenues. Additionally, Wynn Resorts’ Macau operations showed a significant turnover increase of 31%, indicating strong operational results in the region. The company also repurchased 2.36 million shares in the first quarter, demonstrating a commitment to returning capital to shareholders. However, uncertainties related to tariffs have delayed approximately $375 million in capital expenditures at Wynn Las Vegas, primarily affecting the remodeling of the Encore Tower. Management anticipates minimal impact on operational expenses from these delays.
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