Wynn Resorts, Las Vegas Sands Stocks Rise After Macau Data

Gambling revenue out of Macau rose for an eighth straight month, boosting casino stocks Wynn Resorts and Las Vegas Sands

Josh Selway
Apr 3, 2017 at 11:01 AM
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Casino stocks are getting a lift today from strong revenue data out of Macau. Specifically, casino revenue out of the region topped estimates in March with an 18% increase, marking an eighth straight monthly rise. Two of the biggest winners so far are Wynn Resorts, Limited (NASDAQ:WYNN) and Las Vegas Sands Corp. (NYSE:LVS). Let's take a closer look at WYNN stock and LVS stock amid today's pop. 

WYNN Stock Stays Hot

Starting with WYNN, the shares are up 2.7% today at $117.69, earlier touching a roughly two-year high of $119.80. This is far from unusual for the stock, though, as Wynn Resorts has gained 36% year-to-date. And from a contrarian perspective, there could be even more upside on the horizon. 

For instance, nine of the 14 brokerage firms tracking WYNN shares rate them a "hold" or "strong sell," meaning the door is wide open for upgrades to come through on the outperforming stock. Short interest also remains elevated, with 7.6% of WYNN's float controlled by short sellers. 

Meanwhile, options data shows it's a good time to speculate on Wynn Resorts, Limited. This is according to WYNN stock's Schaeffer's Volatility Index (SVI) of 28%, which is just 4 percentage points from an annual low. Said differently, low volatility expectations are currently priced into short-term WYNN options. Today, calls are trading at almost three times the normal intraday pace, with buy-to-open activity detected at the weekly 4/7 120 and 123 strikes.

Short-Term LVS Options are Pricing in Low Volatility Expectations

LVS stock is also on the rise today, adding 1.4% to trade at $57.87. The shares have outperformed the S&P 500 Index (SPX) during the past two months, and broken out above previous resistance at their 160-day moving average. Like sector peer WYNN, the stock could benefit from a round of bullish analyst attention. That is, more than half of the analysts tracking Las Vegas Sands stock say it's just a "hold."

Also, LVS has an SVI of 22%, which ranks below 93% of the past year's readings, suggesting it's a good time to purchase premium on near-term options. It's also promising for options buyers that the shares have a Schaeffer's Volatility Scorecard (SVS) of 79, since this suggests they've regularly made bigger moves over the past year than the options market has priced in. Today, call options are crossing at three times the normal intraday pace, and it looks like new positions are being purchased at Las Vegas Sands Corp.'s weekly 4/13 58 strike.

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