Moody’s Upgrades Wynn Resorts’ Outlook to Positive Amid Macau Recovery

Moody’s Investors Service has changed the credit outlook for Wynn Macau and its parent company, Wynn Resorts, from “stable” to “positive.” This change shows hope for the group’s financial situation to change for the better. The improvement comes from Macau’s casino business bouncing back and strong results at its US properties, Wynn Las Vegas and Encore Boston Harbor.

Moody’s Highlights Debt Reduction and Macau Recovery in Wynn Resorts’ Outlook

The rating agency kept Wynn Resorts’ debt at “B1,” still in the non-investment grade bracket. Moody’s pointed out that the company’s leverage is likely to get much better, with debt-to-EBITDA figures expected to settle around the mid-5x mark by 2024. This bounce-back goes hand in hand with the comeback of Macau’s gaming industry, which has made big strides since the pandemic hit.

Wynn Resorts has improved its credit profile by cutting down on debt getting rid of almost $1.2 billion in what it owes. Moody’s pointed out that the company shows strong cash flow, keeping plenty of money on hand — $1.34 billion at the end of September — even though it still has $11.79 billion in total debt. These steps help create a more solid financial situation and should lead to cheaper borrowing in the future.

Macau still has a big influence on Wynn’s income, though this dependence brings risks from focusing on one area. Still, Moody’s noted Wynn’s efforts to branch out, like building Wynn Al Marjan Island in the UAE. The UAE project, which is set to open in 2027, offers a years-long monopoly in a growing market, which might lessen Wynn’s reliance on its other locations.

Strong Brand and Debt Management Position Wynn Resorts for Future Upgrades

The Las Vegas casino company’s knack for running top-notch resorts also helped shape the positive outlook. Moody’s praised Wynn’s strong brand appeal and excellent operations, which boosted revenue and EBITDA growth across its properties.

Future improvements in Wynn’s credit rating will rely on steady income growth more debt paydown, and keeping strong cash reserves. Moody’s said that reaching a debt-to-EBITDA ratio that stays under 6x, plus positive cash flow, would play a big part in getting a better rating.

To sum up, Wynn Resorts is in a good spot for growth and stability down the road, according to Moody’s. This is because it can take advantage of Macau’s comeback, spread out its business, and handle its debt.In other recent news, Tilman Fertitta increased his stake in Wynn Resorts, making him the largest individual shareholder. This also signals strong confidence in the company’s future. Analysts viewed the move as a strategic investment rather than an immediate step toward a takeover.