Stocks of Wynn Resorts, Limited (NASDAQ:WYNN) came down to its lowest level since November 2012 after it announced dividend cut. As per the reports, the betting activities of Wynn Resorts tumbled in Macau lately and forced the leading casino to cut dividends in the most recent quarter.
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Company’s shares came down to $108.77 level after witnessing 17% reduction within a day in New York. It was the largest drop that Wynn Resorts had witnessed since 2008. This year hasn’t been good for the company, especially in terms of stock performance. Wynn Resorts’ shares have fallen 27% this year due to inconsistent business activities. Wynn earns over two third of its revenues from betting activities in Macau, but last few months haven’t been supportive at all. Due to a sharp drop in betting activities in Macau, Wynn has suffered badly.
In terms of profit after excluding special items, it managed to earn 70 cents a share. The actual profit figure was way below than the $1.19 average profit per share that analysts had estimated. Due to below average performance, the leading casino had to reduce its dividend to 50 cents a share, 66.6% below than the estimated dividend.
Macau, the only place in China where betting is legal, is considered as one of the largest markets for such activities in the world. Wynn managed to earn $705.4 million revenues from various betting activities in Macau during the previous quarter, down 38% from the previous year’s revenues. Wynn Resorts, Limited (NASDAQ:WYNN) has been planning to expand its operations in Macau for last few years. Recently it unveiled its plans to open a new property worth $4.1 billion in Macau in the first half of the next year.
The senior management of the company looks forward to performing well in the upcoming market and hopes that Wynn will overcome its below expectation performance soon.
