WYNN MACAU(HK:01128) Soochow Securities international·2024-05-10 01:02Investment Rating - The report maintains a "Buy" rating for Wynn Macau (1128.HK) [1] Core Views - The company's performance in Q1 2024 exceeded expectations, with strong recovery in mass gaming revenue [1][3] - The management indicates that the momentum in mass gaming business remains robust since Q2 2024 [3] Financial Performance Summary - For Q1 2024, the company achieved gaming revenue of $1 billion, recovering to 68.9% of the level from Q1 2019 [2] - VIP and mass gaming revenue reached $180 million and $820 million respectively, recovering to 23.2% and 122.6% of Q1 2019 levels [2] - The adjusted property EBITDAR for Q1 2024 was $340 million, exceeding Bloomberg consensus by approximately 10% [3] - The adjusted property EBITDAR margin improved from 30.9% in Q1 2019 to 34.0% in Q1 2024 [3] Earnings Forecast and Valuation - The revenue forecast for 2024-2026 has been raised to HKD 31.08 billion, HKD 33.88 billion, and HKD 35.84 billion respectively [3] - The adjusted property EBITDAR forecast for the same period is updated to HKD 9.68 billion, HKD 10.67 billion, and HKD 11.32 billion [3] - The current stock price corresponds to EV/Adjusted Property EBITDAR multiples of 8.6, 7.8, and 7.3 for 2024-2026 [3] Operational Insights - The average daily operating cost in Q1 2024 was $2.63 million, down approximately 17.8% from $3.20 million in Q1 2019 [3] - The company expects average daily operating costs to fluctuate around $2.6 million in the future [3] - Capital expenditures for 2024-2025 are projected to be between $350 million and $500 million [3]