Analysts speculate on how Wynn Resorts will handle future projects
Steve Wynn has long been known as the visionary for his hotels and for bringing size, luxury and entertainment to the Strip.
But now that the 76-year-old billionaire has resigned as Wynn Resorts chairman and CEO amid allegations of sexual misconduct, will his namesake casino company be able to pull off projects with the same success?
Wynn Resorts, which operates two hotels on the Strip and two in Macau, is planning or building projects in Las Vegas, Massachusetts and Macau.
Some are further along than others, and it’s too early to tell how Wynn’s departure, announced Tuesday night, will impact the pipeline of projects.
But in the wake of his resignation amid, as he put it, “an avalanche of negative publicity,” analysts are trying to gauge how the company will fare without Wynn at the helm.
As Jefferies analyst David Katz said in a research note: “Elvis has left the building.”
Wynn’s “value to the company is unarguably profound as its chief visionary and diplomat,” Katz wrote. “As such, we do not believe the company can grow at the same trajectory nor can it maintain its cutting edge position.”
Wynn, who developed The Mirage, Treasure Island (now TI) and the Bellagio before launching Wynn Resorts, built the Wynn Las Vegas and Encore through his namesake company.
Without Wynn in charge, Katz said in a phone interview, it’s “entirely fair to call into question whether the company can grow and execute those kinds of projects in the future.”
Asked whether the departure could impact Wynn Resorts’ ability to raise money for projects, Katz said that is “a fair question” to which “we don’t really know the answer.”
Wynn Resorts’ $2.4 billion Wynn Boston Harbor project in Everett, Massachusetts, is under construction and set to open next year. The company also has started work on Paradise Park, which would replace the golf course behind the Wynn Las Vegas and Encore with a 47-story hotel and 38-acre lagoon.
And last month, just days before The Wall Street Journal reported that Wynn had a decadeslong pattern of sexual misconduct, he outlined plans for Wynn West, a 2,000- to 3,000-room hotel next to Fashion Show mall, and said he wanted to expand Wynn Palace in Macau.
J.P. Morgan Securities analyst Joseph Greff upgraded Wynn Resorts stock after the resignation was announced. He said in a research note that Steve Wynn’s exit “meaningfully” reduces the company’s gaming-license-revocation risks.
Morningstar Research analyst Dan Wasiolek wrote that Wynn Resorts’ “design quality is unlikely to be affected” by the resignation, in part because its executive bench included 42-year-old President Matthew Maddox, who joined the company in 2002 and was named CEO on Tuesday night.
Wasiolek said in a phone interview that design quality is “paramount to how Wynn has differentiated itself,” and that plans for Wynn Boston Harbor and Paradise Park have been drawn up.
Still, as for Wynn West and the Macau expansion, he said, “there’s some elevated risk to those projects not having Steve Wynn’s involvement.”
Asked to comment on how, or whether, the departure could affect its projects, Wynn Resorts spokeswoman Deanna Pettit-Irestone emailed a section of the resignation announcement.
It said the company will “continue to fully focus” on its operations in Macau and Las Vegas, the “development and opening of the first phase” of Paradise Park and construction of Wynn Boston Harbor.
Read complete coverage about Wynn and the accusations of sexual misconduct
Contact Eli Segall at esegall@reviewjournal.com or 702-383-0342. Follow @eli_segall on Twitter.
