Global Gaming and Casinos Industry Specialist, Casino Business Review LLC

Howard J Klein

Global Gaming and Casinos Industry Specialist

Equity Bottom-Up

<ul>
<li>Investors have not yet baked in a clear outperform potential on this Hong Kong traded subsidiary of US Wynn Resorts Ltd (NASDAQ:WYNN).</li>
<li>A recent investor day presentation confirms that this is an Asia centric company based on its capex expectations for Macau vs. Las Vegas.</li>
<li>Macro risk continue to spook the VIP segment. Its part of what keeps the shares trading lower than they should based on bullish forward strategies now in place.</li>
</ul>


Investors have not yet baked in a clear outperform potential on this Hong Kong traded subsidiary of US Wynn Resorts Ltd (NASDAQ:WYNN).
A recent investor day presentation confirms that this is an Asia centric company based on its capex expectations for Macau vs. Las Vegas.
Macro risk continue to spook the VIP segment. Its part of what keeps the shares trading lower than they should based on bullish forward strategies now in place.


Wynn Macau Ltd: Is True Forward Value Still Hidden by Conservative Projections?

Investment Advisors, JL Warren Capital

Junheng Li

Investment Advisors

JL Warren Capital

JL Warren Capital LLC is a leading independent equity research firm focused on Chinese companies and listed multinationals in China. We employ a bottom-up research approach that takes great care to avoid the acquisition of material non-public information. Through investigative due diligence including channel surveys and interviews, our research helps clients to pinpoint the dislocations in the market.

Thematic (Sector/Industry)

Macau printed much better than expected June GGR of 5.9% YoY, due to a combination of positive factors:  1) one big spender in VIP room rolled as much as ~10 bn HKD in June (either the guy or the junket operator should have gone bankrupt but the operator is still in business so we estimate that the player lost lots of money so unlikely to return Macau soon); 2) both VIP and mass segments were negatively impacted by 2018 World Cup Russia from June 14 to Jul 15, setting low comp for June 2019; 3) unprecedented HK protests in scale and duration starting on June 9th turned off mainland tourists who consequently have deprioritized HK as an outbound destination, shifting demand to Macau.

Macau printed much better than expected June GGR of 5.9% YoY, due to a combination of positive factors:  1) one big spender in VIP room rolled as much as ~10 bn HKD in June (either the guy or the junket operator should have gone bankrupt but the operator is still in business so we estimate that the player lost lots of money so unlikely to return Macau soon); 2) both VIP and mass segments were negatively impacted by 2018 World Cup Russia from June 14 to Jul 15, setting low comp for June 2019; 3) unprecedented HK protests in scale and duration starting on June 9th turned off mainland tourists who consequently have deprioritized HK as an outbound destination, shifting demand to Macau. 

Macau Update: Individual Whale Boosting June VIP; WC 2018 Low Base, Mass Benefiting from HK Protests

Senior Credit Analyst, Lucror Analytics

Leonard Law, CFA

Senior Credit Analyst

High Yield Experts

Lucror Analytics

Lucror Analytics is a leading credit and ESG research specialist and a provider of technology solutions for differentiated fixed income strategies. Our roots are in bottom-up fundamental credit analysis with a specialization in high yield corporate credits from Europe, Asia and Latin America. We are one of few research specialists integrating ESG considerations with fundamental credit research through a dedicated ESG platform. Our ESG assessment covers five key criteria: Disclosure, E,S, & G Pillars, Controversies, ESG Impact on Credit and ESG Momentum.

Recognizing the importance and value-add of Factor Investing in fixed income, Lucror developed the Smart Quant Navigator (SQN), an intuitive platform that helps clients devise and implement factor-based strategies ranging from pure quant to active fundamental, with integrated ESG.

Our company has been at the forefront of developments in the fixed income markets, identifying opportunities and consistently delivering new products and value-adding solutions to clients. Lucror has close relationships with the largest and most reputable asset managers, family offices, hedge funds, investment and wealth managers globally.

Credit

In this month’s “In-Focus” section, we discuss the vulnerability of Asian credits to external shocks, with the threat this year being the potential fallout from a protracted Sino-US trade war. The Asia Monthly focuses on providing updates on recent events, information on new issues and spread movements, as well as summarising our top picks, and discussing specific areas of interest in the “In-Focus” section. The Asia Monthly is intended to broaden investors' understanding of the Asian USD high-yield market.

   In this month’s “In-Focus” section, we discuss the vulnerability of Asian credits to external shocks, with the threat this year being the potential fallout from a protracted Sino-US trade war.    The Asia Monthly focuses on providing updates on recent events, information on new issues and spread movements, as well as summarising our top picks, and discussing specific areas of interest in the “In-Focus” section. The Asia Monthly is intended to broaden investors' understanding of the Asian USD high-yield market. 

Asia HY Monthly - Vulnerability Of Asian Credit Market To External Shocks (2019) - Lucror Analytics

The Asia HY Trade Recommendations report for June includes a summary of our recommendations, as well as our high-conviction ideas. We also provide relative-value charts and lists of the bonds in the Lucror Asia HY index.

   The Asia HY Trade Recommendations report for June includes a summary of our recommendations, as well as our high-conviction ideas. We also provide relative-value charts and lists of the bonds in the Lucror Asia HY index. 

Asia HY Trade Recommendations - June 2019 - Lucror Analytics

Since May 10 when Chinese Vice Premier Liu He left the Washington without a trade deal with the US, nor any plan for future talks, both countries have been heating up the rhetoric’s against each other at home, diminishing the public’s perception of a deal in near future.   We believe that the trade talks broke down due to highly principal issues.  China were indeed to comply with the signed “contract” on paper, its state interest in strategic industries and state-owned-enterprises would be severely compromised – something that Chins is not ready nor willing to do for now.  What’s more, the complex friction within the Party, and opposition from the conservatives, played a key role in Xi’s hardening position against the US.  While projecting a hardline to the domestic audience, China on the other hand, has NOT engaged any significant counter measures since Trump’s somewhat unexpected tariff hike of 25% on one third of all Chinese products effectively on May 10th.

Since May 10 when Chinese Vice Premier Liu He left the Washington without a trade deal with the US, nor any plan for future talks, both countries have been heating up the rhetoric’s against each other at home, diminishing the public’s perception of a deal in near future.   We believe that the trade talks broke down due to highly principal issues.  China were indeed to comply with the signed “contract” on paper, its state interest in strategic industries and state-owned-enterprises would be severely compromised – something that Chins is not ready nor willing to do for now.  What’s more, the complex friction within the Party, and opposition from the conservatives, played a key role in Xi’s hardening position against the US.  While projecting a hardline to the domestic audience, China on the other hand, has NOT engaged any significant counter measures since Trump’s somewhat unexpected tariff hike of 25% on one third of all Chinese products effectively on May 10th.

Rising Nationalism Propaganda by State Media, China Macro Data 4M 2019

Hong Kong

Wynn Macau, Limited owns and operates Wynn Macau, a destination casino resort currently featuring hotel rooms and suites, a casino, casual and fine dining restaurants, retail space and leisure amenities.

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Wynn Macau Ltd (1128 HK)

Wynn Macau Ltd: Is True Forward Value Still Hidden by Conservative Projections?

Investors have not yet baked in a clear outperform potential on this Hong Kong traded subsidiary of US Wynn Resorts Ltd (NASDAQ:WYNN). A recent...

Howard J Klein

Macau Update: Individual Whale Boosting June VIP; WC 2018 Low Base, Mass Benefiting from HK Protests

Macau printed much better than expected June GGR of 5.9% YoY, due to a combination of positive factors: 1) one big spender in VIP room rolled as...

JL Warren Capital

Asia HY Monthly - Vulnerability Of Asian Credit Market To External Shocks (2019) - Lucror Analytics

In this month’s “In-Focus” section, we discuss the vulnerability of Asian credits to external shocks, with the threat this year being the...

Lucror Analytics

Asia HY Trade Recommendations - June 2019 - Lucror Analytics

The Asia HY Trade Recommendations report for June includes a summary of our recommendations, as well as our high-conviction ideas. We also...

Lucror Analytics

Rising Nationalism Propaganda by State Media, China Macro Data 4M 2019

Since May 10 when Chinese Vice Premier Liu He left the Washington without a trade deal with the US, nor any plan for future talks, both countries...

JL Warren Capital

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