Wynn Resorts fares better than many in the casino and hotel industry
There can be few people with a track record in the hotel and casino sector to match that of Stephen Wynn the founder of Wynn Resorts. While many of the larger competitors in the sector continue to struggle, as highlighted by our post on MGM Mirage, it appears as though Wynn Resorts is in one of the strongest positions of any company in the sector. Over the last few months share issues have been regarded as desperate fundraising operations but the 9.6 million share offer, to raise $182.4 million, has been well received by holders of Wynn Resorts stock.
While it would be foolish to suggest that the company can swim against the tide forever, the $182.4 million to be raised will be used to realign the company’s debt position with speculation that some may also be put aside for small-time acquisitions. As many in the sector continue to struggle it is obvious that opportunities will arise at some stage in the future and companies such as Wynn Resorts appear well-positioned to take advantage.
However, whether stock analysts would welcome an acquisition program at this point in the economic cycle very much remains open to debate.
