Life after Wynn

There may not be much, according to a feature in the New York Times. Wall Street analysts are already circling Wynn Resorts like buzzards. “Elvis has left the building. Mr. Wynn’s value to the company is unarguably profound as its chief visionary and diplomat. As such, we do not believe the company can grow at the same trajectory nor can it maintain its cutting edge position,” wrote Jeffries analysts. They added, “Given the reduced value implied for the company going forward, we believe the value of the market value of the assets could be higher.” In other words, sell the company off in pieces. That would certainly appeal to rival companies that haven’t got the $24 billion scratch for Wynn Resorts in toto or have antitrust concerns but would like to increase their presence in select markets. For instance, perhaps Sheldon Adelson will have a change of heart about his native Boston area, now that Wynn has done most of the heavy lifting in that region. Then again, the $2.4 billion price tag on Wynn Boston Harbor may give him pause, as might projected ROI of just under 10%.

In addition to shareholder lawsuits, Wynn Resorts still has to fend off regulatory concerns. Wynn Macau President Linda Chen was called on the carpet by the Gaming Inspection & Coordination Bureau. In Massachusetts, the chairman of the Massachusetts Gaming Commission did not hesitate to evoke Watergate in his rhetoric. Asked Stephen Crosby, “A central question is, what did the board of directors and staff know, and when did they know it, about the [$7.5 million] settlement and the associated allegations?” Given the lengths taken to conceal the payment behind Entity Y, this particular angle of the story is likely to hang fire for some time to come.

“We have little insight into what the MGC is likely to do from here,” wrote Deutsche Bank analyst Carlo Santarelli, “with Mr. Wynn having resigned, but all indications point to a continued review and we expect media headlines and Commission sound bites will continue to draw attention from investors, as they did again this afternoon. That said, we believe concerns over the response from the other regulatory agencies are overblown.” Added Santarelli, “we believe the potential for a sale of the Macau operations to a non-traditional gaming operator is more likely than a sale involving an existing concessionaire or traditional gaming operator that lacks roots in Macau.”

Meanwhile, Wynn himself lurks on the premises like Banquo‘s ghost, haunting a high-roller villa and controlling a plurality of WYNN stock. Given his cult of personality, are other executives close to him going to jump ship as well? Not new CEO Matt Maddox, who has gotten very rich through Steve Wynn and might be grateful enough to be Wynn’s puppet. Analyst concerns on this last point seem exaggerated, as there are few places to which they can jump at present, unless Resorts World Las Vegas has a sudden need for executives. Finally, there’s the matter of the Wynn brand. Political fixer Billy Vassilliadis thinks it should be kept. Others differ. Wharton School marketing boffin Barbara Kahn thinks the last thing the company should do is dither: “If they decide they are going to do it, then they should rip the Band-Aid off and just do it.”

* What to make of Dan Gilbert‘s Ohio casinos? Their market behavior continues to defy predictability. Last month, Jack Cleveland ($16.5 million) shot up 9% but Jack Cincinnati ($14.5 million) plunged 10%. One presumes that the same marketing formula is being applied to both casinos, but with wildly varying outcomes. Gilbert’s third casino, Jack Thistledown, was up 2% to $9 million. Of course, Hard Rock Rocksino serenely maintained its lead in the Buckeye State, banking $19 million, a 5.5% increase from last year. Although their grosses compared favorably to Gilbert’s, Penn National Gaming‘s casinos had an off month. Hollywood Toledo was flat at $15 million while Hollywood Columbus grossed $17 million but was 2%. Out at the racinos, Scioto Downs was flat at $12 million, Belterra Park slipped 2.5% to just under $6 million (good luck to Boyd Gaming when it takes that one over) and Miami Valley Gaming was up 2% to finish at $11 million. Penn’s two racinos continued to perform impressively. Hollywood Dayton rose 3% to nearly $8 million while win/slot/day champion Hollywood Mahoning Valley was up 4% to finish at $9 million,