Wynn Resorts exuded overconfidence in a meeting with JP Morgan analysts. It’s already booking revenue from Encore Boston Harbor without knowing it’s going to hang onto the license. It also expects new revenue to be driven by the debut of its Las Vegas convention center 
and renovation of its older Macao casinos. Wrote Joseph Greff, “WYNN will likely maintain a requisite level of dry powder as it evaluates capex, Macau investment is viewed as the best use of capital longer term, and it will also exercise discretion in buying back stock when it becomes dislodged … WYNN was upbeat on the prospects for Macau, and encouraged investors not to overthink the short-term choppiness inherent in that market. The large, well-capitalized junkets feel fine.” While it sees some long-term benefit from the HKZM Bridge, it believes it is a more convenient way of bringing gamblers in from Hong Kong, not a fundamental game-changer.
Having placed a large wager on Macao, Wynn execs are bulling on its future, expecting to outpace China‘s gross domestic product “for the foreseeable future.” The addition of the Crystal Palace extension won’t happen until 2021, giving Wynn Resorts little time to monetize it before its concession (theoretically) runs out in 2022.
* Las Vegas Sands remains Macao-centric: “Specifically, LVS sees ample opportunity in the mass gaming and non-gaming space, as the Chinese consumer remains healthy and continues to spend money.” It also takes a more expansive view of the HKZM Bridge, seeing it as a 
portal to lure in more tourists of Japan, Korea and elsewhere. Also, Sands’ long-term picture includes Macao becoming the convention and exhibition capital of Asia. Mass-market gambling continues to improve at a rate of 10% a year, another figure that Sands thinks will burgeon with the HKZM Bridge opening.
Although it was not addressed at the meeting, Sands China has begun work on the $2.2 billion conversion of Sands Cotai Central, starting with the Holiday Inn. The company “acknowledges there will be some disruption (there is none today) as it works through renovations, but once complete in 2021, the tourism influx will be worth the near term disruption.”
In Singapore, Sands is still trying to sell its retail mall (this has been going on for years). Now its face-saving stance is that Sands “views it as 
a trophy asset and would only look to monetize in the event of a capital need.” Speaking of monetization, the Marina Bay Sands room product is due for an upgrade, especially as MBS is reliant on attracting international guests. As for Japan, Senior Vice President Daniel Briggs did not elaborate on strategy beyond naming Tokyo, Osaka, and Yokohama as the targets of opportunity. Conspicuously unmentioned in the meeting: Las Vegas.
* Fortunately for Scientific Games, it’s not placing all its eggs in the replacement-cycle basket, as machine turnover is expected to be in the low-single-digit range. SGMS execs told Morgan analysts it “expects similar growth trends in 2019 as seen in 2018. More specifically, the gaming supplier and lottery businesses will likely be low single digit growers, while digital could grow at a mid/low teens rate.” Lottery-contract renewal in Pennsylvania and Italy will also help. Priority #1 is leverage reduction, including the sale of the Chicago office.
* In a desperate attempt to placate Carl Icahn, mass bloodletting is taking place at Caesars Entertainment corporate headquarters. $40 million in payroll will be dumped. As one S&G reader said, “Like that’s going to help.”
