The latest addition to the Cotai landscape, Wynn Palace, is in good shape to claim decent market share – particularly at the higher end of the spectrum – according to Union Gaming analyst Grant Govertsen.
“Talking to junkets and spending time in VIP rooms over the past week suggests the high end of the market has turned up at Wynn Palace and volumes are strong (for junket and direct VIP/premium business),” Govertsen said after the property completed its first week of business.
“For now, we believe a significant portion of this volume comes at the expense of Wynn Macau. Over time this should reverse and we expect to see market share gains at the corporate level as existing Cotai-centric high end customers gravitate towards WP with the eventual help of WP marketing efforts.”
The primary concern since Wynn Palace opened its doors has centred around whether or not it brings anything new to Macau. It has also been noted the main gaming floor has been relatively slow compared to Galaxy Phase 2 and Studio City which both opened in 2015.
But Govertsen said such perceptions could prove misleading, with “the vast majority of cash flow being generated behind closed doors.”
“In line with our long-term on-the-ground thesis that customers are aspirational in nature and seek quality with all other things being equal, the sheer quality of Wynn Palace should draw enough new-to-Wynn customers from other Cotai casinos and allow it to grow earnings in 2017,” he said.