Wynn Resorts (NASDAQ: WYNN) is forecasting that its upcoming integrated resort, Wynn Al-Marjan Island, in the United Arab Emirates, will generate up to $600 million in EBITDA (earnings before interest, taxes, depreciation, and amortization) after deducting interest, taxes, depreciation, and amortization expenses.
Craig Billings, CEO of Wynn, stated in a conference call with analysts on Tuesday that Wynn Resorts expects EBITDA earnings from its Al-Marjan Island integrated resort in the UAE to remain stable between $450 million to $600 million. They own a 40% stake in the project and will combine it with management and licensing fees to provide a very healthy return on investment (ROI) for Wynn Resort’s shareholders.
Wynn Resort is developing the property on Al-Marjan Island in partnership with local partners Marjan LLC and RAK Hospitality Holding LLC, at an estimated cost of $4 billion. The project is expected to be the first casino in the region and is planned to open in early 2027. Wynn Resort holds a minority stake in the joint venture, which means it won’t bear the full $4 billion financial risk.
As casino gaming has not yet been officially approved, the casino will not be the core of the resort. It is estimated that the casino will only occupy 4% of the total property area. Compared to Wynn’s venues in Macau or Boston, the resort is more similar to Wynn’s business in Las Vegas, focusing not on gaming, but on providing a high-quality integrated experience.
Dubai, as one of the largest cities in the Middle East in terms of tourism, attracts many visitors, providing many opportunities for Wynn’s resorts in the UAE.
Wynn Resort has resumed quarterly dividends and is generating stable cash flow. Analysts believe that this is a positive sign that the company’s future cash flow should be sufficient to meet and exceed future capital commitments.
Wynn’s stock price has performed well, and analysts believe that its valuation is reasonable, as its stock trades at around 9 times forward EBITDA, which is a discount from historical multiples. The analyst reiterated a “buy” rating on Wynn and raised its target price from $127 to $137.