Wynn Corporate Bonds Supported by Buoyant UAE Casino Outlook
Posted on: June 24, 2025, 04:05h.
Last updated on: June 24, 2025, 04:05h.
- Wynn Resorts has junk credit ratings, but research firm sees opportunity with some of the issuer’s corporate debt
- Positive outlook supported in part by UAE casino hotel
The three major ratings agencies apply junk grades to Wynn Resorts (NASDAQ: WYNN) corporate credit profile, but at least one analyst sees potential in some of the issuer’s bonds with that thesis supported by the operator’s compelling United Arab Emirates (UAE) casino hotel project.
In a new report, Kim Noland, director of high-yield research at GimmeCredit, sounded a constructive tone on some Wynn debt with further out maturities, citing potential long-term benefits from Wynn Al Marjan Island. That integrated resort, which will be the first regulated gaming venue in the Middle East, is scheduled to open in early 2027.
The affluent and fast-growing demographic of the UAE aligns with a potential market opportunity of $5 billion to $8 billion, a market size that approaches the Las Vegas Strip. Wynn has invested nearly $700 million in the project and expects to spend another $700 million to $775 million this year and next,” observes Noland.
She rates Wynn bonds maturing 2031 “outperform.” That issue carries a coupon rate of 7.125% and currently sports a yield-to-worst of 6.1%.
Wynn Bond Prices Steady Amid Fertitta Involvement
Noland noted Wynn debt prices “have remained stable” amid Tilman Fertitta’s increased equity position in the casino operator.
Through a series of transactions earlier this year, Fertitta, now serving as US ambassador to Italy and San Marino, upped his stake in Wynn to approximately 13%. That makes the Houston Rockets owner the largest Wynn shareholder and his recent buys of the stock have stoked speculation that he’ll only remain a passive investor for so long.
At a Nevada Gaming Control Board (NGCB) meeting earlier this month, Fertitta Entertainment General Counsel Steven Scheinthal acknowledged his former boss isn’t pleased with Wynn’s share price — the first public comments to that effect since Fertitta became a Wynn investor.
Since Fertitta’s initial stake in Wynn was revealed in October 2022, there’s been ample speculation that he could move to acquire the gaming company outright, but that’s been quashed by analysts and the odds of such a transaction are likely longer today due to his role as ambassador. On Wall Street, there’s a saying that “credit leads equity,” implying that recent steadiness in Wynn corporate bond prices indicate a buyout isn’t likely to materialize over the near-term.
Some Signs of Life in Macau
Macau, Wynn’s largest operating market, has been notching tepid gross gaming revenue (GGR) figures since the coronavirus pandemic, but May brought signs of optimism and that could add to the bullish thesis for Wynn bonds.
“Macau gross gaming revenue picked up in May due to holiday and family events, and reached the highest monthly total since before the pandemic,” said Noland.
The GimmeCredit analyst points out that Wynn will spend $750 million over the next two years on non-gaming amenities at its two Macau properties with those expenditures funded by current liquidity and cash flow, not the issuance of new debt.
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