Wynn Resorts Finance Credit Outlook Upgraded by Moody’s
Wynn Resorts’ (NASDAQ: WYNN) finance unit saw its credit outlook upgraded to “positive” from “stable” by Moody’s Investors Service. The research firm maintained a “B1” rating on Wynn’s debt — four notches into junk territory.
Moody’s cited the ongoing recovery in Macau as well as strength at Wynn’s Las Vegas casinos and Encore Boston Harbor as among the reasons for the upgrade. Third-quarter results for Macau operators, including Wynn Macau, were tepid, but gross gaming revenue (GGR) in the Chinese territory has improved mightily since the start of the coronavirus pandemic and that trend is expected to continue in 2025.
The rating affirmation and positive outlook reflect our projection of improved leverage for Wynn in the mid 5x debt/earnings before interest, taxes, depreciation, and amortization (EBITDA) range for 2024, as Macau’s gaming market has recovered significantly and continued strong performance at the company’s Las Vegas and Encore Boston Harbor properties have supported revenue and EBITDA growth,” observed Moody’s.
The ratings agency added that Wynn’s improved credit profile is a reflection of “the quality, popularity, favorable reputation of the company’s resort properties,” which Moody’s says are distinguishing factors.
Wynn ‘Positive’ Outlook Has Substance
Wynn concluded the September quarter with cash on hand of $1.34 billion and debt of $11.79 billion and its efforts to trim the latter figure are among the reasons for the Moody’s outlook upgrade.
The research firm noted the Las Vegas-based gaming company has worked diligently to pare its debt burden. Such efforts are often viewed favorably by ratings agencies and can have the added benefit of improved credit grades, which result in lower financing costs.
