JPMorgan Says Concerns Over Wynn UAE Casino Are Exaggerated

Investor concerns surrounding the fate of Wynn Resorts’ (NASDAQ: WYNN) Wynn Al Marjan Island project in the United Arab Emirates amid Middle East geopolitical tensions are overblown, according to JPMorgan equity research.

Immediately following U.S. and Israeli military strikes on Iran in late February, retaliatory strikes in the United Arab Emirates forced Wynn Resorts to briefly pause construction on its flagship project. However, the $5.7 billion Wynn Al Marjan Island development remains on track to open in September 2027.

JPMorgan analysts met with Wynn executives at the Global Gaming Expo (G2E) in Las Vegas, emerging from the meetings with a constructive outlook on the UAE project.

The metrics align with recent data from the Ras Al Khaimah Tourism Development Authority, which reported that the emirate welcomed 670,000 visitors in the first half of the year despite ongoing regional conflict.

Long-Term UAE Market Prospects

Some market observers previously suggested the sell-off in Wynn shares was overdone, noting that Wall Street continues to attribute minimal value to the Middle East’s first integrated casino resort.

JPMorgan analysts noted that Wynn management “remains confident in achieving its base-to-high case steady-state assumptions,” implying the UAE could ultimately mature into one of the world’s most lucrative gaming jurisdictions.

Industry forecasts indicate the UAE could generate $3 billion to $5 billion in annual gross gaming revenue (GGR) as additional integrated resorts enter the market following Wynn Al Marjan Island’s debut.

Additionally, JPMorgan highlighted management’s belief that regional instability could extend Wynn’s exclusivity period, as UAE authorities may slow the approval timeline for competing gaming licenses.

Macau Headwinds and Cotai Expansion

Shares of Wynn Resorts are down more than 36 percent year-to-date, with analysts citing weakness in Macau—rather than the Middle East—as the primary drag on equity performance. September marked the fourth consecutive month of GGR declines in the Chinese territory, which represents Wynn’s largest operating market.

Despite current softness in Macau, JPMorgan identified upside potential from the Enclave expansion project at Wynn Palace on the Cotai Strip. The development, which features a $950 million second hotel tower, is projected to support long-term earnings before interest, taxes, depreciation, and amortization (EBITDA).

The expansion could generate approximately “$400 million of GGR and a mid/high-teens return, translating to approximately $150 million to $175 million of incremental EBITDA,” according to JPMorgan estimates.