Wynn Resorts stock slipped about ten dollars a share between the Sept. 6 opening in Macau and the end of last week.
So what’s the problem?
Steve Wynn’s not talking, not yet, anyway, but there are some clues being dropped by insiders who made the trip to Macau and they do not ad up to good news for Las Vegas’ best-known developer of new resorts.
Not yet, anyway.
Some of the financial analysts who made the long trip reportedly came away a little unhappy with what they saw.
And why is that?
The crowds were not as large as expected and some of the gamblers supposedly said that, all things considered, they preferred Sheldon Adelson’s place.
Then again, the success of an opening should not to be judged by crowds alone, just as the results of the first couple weeks — good, bad or otherwise — don’t mean much. I clearly recall that when Bellagio opened in 1998, some of the analysts who showed up to assess things were astounded that the Bellagio actually had rooms available on opening day.
But, Bellagio seems to have survived.
Wynn’s CFO at the time, Dan Lee, rolled his eyes and said something like, get real guys. We’re building a resort that is going to be making a lot of money for a long time.
The performance of the Bellagio since then speaks for itself. No resort on the Las Vegas Strip makes more money, although the current owners certainly deserve a ton of credit for their continued and successful fine tuning of what Wynn created.
How many times did he close the doors or limit admittance at The Mirage and Bellagio because he wanted real customers with money to spend to have a comfortable experience.
On the other hand, when Wynn opened the Beau Rivage at Biloxi in 1999, he overshot the market by a mile, a fact that he would concede when he told analysts at that time, "The Beau Rivage is the blinking yellow light in this company."
But the fact is crowd counts even though they’ve never been a big Wynn priority.
Wynn promised an experience that would surpass anything available in Macau. Let’s see what the numbers say as Wynn reports his third quarter in October or November.
Wynn eyes AC site
Steve Wynn continues to pile up those frequent flier miles, reportedly spending some recent quality time in Atlantic City scouting the possibilities.
He may be among the people who are very interested in what happens to the 150-200 acres of Bader Field real estate. Wynn has previously demonstrated his talents at assembling attractive packages, putting together the so-called H-tract (MGM refers to it as Renaissance Pointe) and then getting the state to build a tunnel off the expressway leading to what is now the Borgata.
City officials want to see the Bader real estate rezoned for multi-use developments that would include condos, casinos and whatever an imaginative developer might want to put into such a project.
The current gaming industry as a body is not much interested in seeing this happen, probably because the Bader neighborhood is not where they’ve done their investing.