‘While we do not necessarily anticipate a dividend trajectory of this nature, we view the potential optionality favourably,’ the report on Wynn states.
As Wynn Macau Limited balance sheet is not a concern anymore, Deutsche Bank expects Wynn to ‘increase returns of capital, as opposed to leaving excess cash on the balance sheet.’
‘We believe dividend capabilities can exceed US$1.2 billion in 2019, relative to the US$422 million of final (2016) and interim (2017) dividends paid in 2017,’ Deutsche Bank analysis indicates.
The report also highlights the opportunity Japan represents for the firm. It says that such market should be a priority and that Wynn ‘has been quietly working aggressively to position for a license. We expect Wynn would finance Japan out of a separate restricted group and management expects to partner for the development.’
Deutsche Bank estimates the Nippon market could be valued some US$20 to US$30 billion and ‘driven primarily by local play.’ The report also discards the presence of junkets as a part of the projects, downplaying the participation of Chinese gamblers.
‘Japan is unlikely to have a material/discernible impact on Macau GGR (Gross Gaming Revenue),’ the report indicates.
