Morgan Stanley: Raised the target price of WYNN MACAU (01128) to HK$6.4 and upgraded EBITDA forecasts.

Morgan Stanley released a report stating that, in response to WYNN MACAU (01128) second quarter actual performance and the continued strong expectations for the mass gaming and slot machine business, it has raised its property EBITDA forecast for 2026 to HK$9.2 billion, a year-on-year increase of 10%. Correspondingly, the target price has been increased from HK$6.1 to HK$6.4, with a rating of "Overweight." The report points out that the target price increase is mainly due to a 5% increase in the 2026 free cash flow equity (FCFE) assumption, reflecting a 6% upward revision in EBITDA forecasts, as well as operating expenses and promotional costs being slightly lower than expected. The firm also expects the property EBITDA for 2027 and 2028 to be HK$9.8 billion and HK$10.5 billion, a year-on-year increase of 6% and 7%, respectively. Morgan Stanley believes that after WYNN MACAU recently increased its dividend, even if the dividend remains unchanged, the forecasted dividend yield is still about 7.7%, which is attractive.