Wynn Resorts WYNN - Daily to 2008 - Bloated Valuation target 160
Wynn Resorts - WYNN - Daily chart shows a large 12-fold+ return from the lows in 2009 to the blow off peak in 2014. Investors have oscillated between paying under 1.9x's sales for WYNN, highlighted in bright green, and 3.7x's sales, highlighted in brilliant red.
Note that margins are on a cyclical peak and optimism abounds for the future of WYNN since it has a premium valuation.
You could make a technical case, like the time in 2011 that it is tracing out a distribution pattern, often-times remarked as a "head & shoulders pattern". Perhaps under the surface there has been a lack of new buying and perhaps some "smart money" is unloading shares up here to take advantage of these PREMIUM prices.
The headlines are seemingly bullish, with strong growth in revenues, but they have come up short of high expectations. I think that is what investors should expect in WYNN going forward - more "digestion" and sideways to lower price action until you catch up to the lower green band traveling across the chart at the 160-100 level and rising at about 10-15% a year.
WYNN 208.73 last -9.29 -4.26% today after 9% sales growth in Macau.
Strategy, sell short above today's high in tomorrow's trading. Risk 225. Target 188 initially.
Tim 2:21PM EST June 3, 2014
Note that margins are on a cyclical peak and optimism abounds for the future of WYNN since it has a premium valuation.
You could make a technical case, like the time in 2011 that it is tracing out a distribution pattern, often-times remarked as a "head & shoulders pattern". Perhaps under the surface there has been a lack of new buying and perhaps some "smart money" is unloading shares up here to take advantage of these PREMIUM prices.
The headlines are seemingly bullish, with strong growth in revenues, but they have come up short of high expectations. I think that is what investors should expect in WYNN going forward - more "digestion" and sideways to lower price action until you catch up to the lower green band traveling across the chart at the 160-100 level and rising at about 10-15% a year.
WYNN 208.73 last -9.29 -4.26% today after 9% sales growth in Macau.
Strategy, sell short above today's high in tomorrow's trading. Risk 225. Target 188 initially.
Tim 2:21PM EST June 3, 2014
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