Zhi Tong Cai Jing·2026-02-16 03:47Core Viewpoint - Morgan Stanley maintains an "Overweight" rating for Wynn Macau (01128) with a target price of HKD 7.4, despite the company's fourth-quarter performance being weak but in line with expectations [2]. Financial Performance - Wynn Macau's EBITDA for Q4 2025 was USD 271 million, reflecting a quarter-over-quarter and year-over-year decline of 12% and 7% respectively. Adjusted EBITDA was USD 287 million, showing a quarter-over-quarter increase of 1% but a year-over-year decrease of 2%, which met Morgan Stanley's expectations but fell short of market expectations [2]. - Over the past year, Wynn Macau's corporate EBITDA decreased by 7% year-over-year, underperforming compared to peers in the industry [2]. Market Context - The total gaming revenue in Macau increased this year compared to Q4 of the previous year, indicating a positive trend in the overall market [2]. - Wynn Palace's new Chairman's Club is set to open before the Lunar New Year, which may enhance the company's offerings [2]. - Retail rental income in Q4 grew by 28% quarter-over-quarter, indicating a positive trend in non-gaming revenue streams [2]. Investment Considerations - The current valuation of Wynn Macau is below the industry average, suggesting potential for upside if market conditions improve [2]. - Investor reluctance to engage with less liquid stocks like Wynn Macau persists unless the company can capture market share, which did not occur in Q4 [2]. - Simply having a low valuation is insufficient to attract investors without demonstrable market share gains [2].