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Published Monday, Nov. 9, 2009 | 7:42 a.m.
Updated Monday, Nov. 9, 2009 | 10:11 a.m.
Wynn Resorts Ltd. today announced it will start sharing profits with shareholders in the form of dividends, with the first payout set for Dec. 3.
The Las Vegas company announced a special cash dividend of $4 per share for stockholders of record as of Nov. 19, which will cost it about $489 million based on the approximately 122.2 million shares outstanding.
Thereafter, a regular cash dividend program is also planned. It's anticipated this regular cash dividend will be 20 cents per share for the first quarter of 2010, payable in the second quarter.
Wynn didn't immediately say why it's paying a dividend.
Dividend programs are typically created to boost value in a company's stock and may be an indication the company doesn't need to hold on to cash for development projects.
In this case, Wynn recently dropped out of the bidding to create a casino at New York City's Aqueduct race track and doesn't appear to have any big U.S. development or acquisition projects in the works.
Having completed a $1.87 billion stock offering for a stake in its Macau business, Wynn is looking at expansion in the Chinese gaming region.
Officials at Wynn Resorts couldn't immediately be reached for comment, but Sterne Agee securities analyst David Bain said it appears Wynn decided on the dividend because it hasn't yet found other opportunities for investing its cash that would bring a rate of return that makes sense.
"There is no question this is a financially strong company with resources to give that extra gift to shareholders, but we would prefer to see capital recently raised from Hong Kong to be plowed into a large growth opportunity, such as Cotai, Macau," Bain said in a client note. "The company still has the capabilities after the dividend to build on Cotai, obviously, but clarity on timing (if ever) is weak."
He said Wynn's dropping out of the Aqueduct bidding wasn't a negative, as Aqueduct in the Queens borough of New York didn't fit the profile of Wynn to operate in premier leisure destinations such as Las Vegas and Macau.
Wynn stock rose 6 percent in early trading today on the news, trading at $63.28, up $3.55.
With world-class dining, shopping, spas, golf and entertainment, there's no shortage of things to do at Wynn. The resort’s aquatic acrobatic show, “Le Reve—The Dream,” a creation by Cirque Du Soleil veteran Franco Dragone and Steve Wynn, will leave guests wanting more with its breathtaking performances that conjure an imaginary world. The Wynn Esplanade offers a unique shopping experience with stores including Chanel, Manolo Blahnik, Christian Dior, Oscar de la Renta and many more. Tryst is its signature nightclub, offering a secluded lagoon inside the club and spacious dance floor. Blush, the Wynn’s ultra lounge, draws swanky party-goers. Tryst, Wynn’s signature nightclub, is situated along a private lagoon under a 90-foot waterfall and plays host to some of the world’s most renown DJs.
Stevie must need the cash.
Stevie must be trying to be one jump ahead of the Gaming Commission and a Gaming Commission hearing.
Rather good news to learn that his enterprises have not been paying dividends to his stock holders. Another Madoff pyramid scheme in the bowels of the Sin City.
How wet has the fall been? I look at the Las Vegas Sun to remember how the sun looks when there's a need to have some sunshine. No need to buy an indoor light to imitate the sun when the Las Vegas Sun is on line.
Wynn is trying to save some face....his operation is FALLING apart !
they do a secondary in hong kong...
then pay a large dividend...
stupid!!!
Beware of Greeks bearing gifts.
Yes, Bill-Owl, the operation is crumbling around him.
What are you going to do with the money you make from the dividend on your shares?
This was a VERY smart move by Wynn. It substantiates the value of his stock using simple cash on cash return ratios. Wynn stock is still the safest bet for any investor who wants to buy a gaming stock for their portfolio.
So like.....why doesn't Wynn just dispurse the payouts to the managers, supervisors, and dealers/bartenders/cocktail servers like they do with the bonehead tip revenue sharing idea ?
I guess Wynn giving money means he doesn't have to pay his up&coming-ex all that money since she will get it in the stock dividend.
AKsilvereagle: Fat chance that Wynn will actually give out bonuses to his workers. He believes in trickle down economics. He trickles down something that would be considered a golden shower.