Wynn Resorts: 'A Short On Any Rally'

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Shares of Wynn Resorts, Limited WYNN have been on a consistent downtrend since last year without witnessing any kind of short-term rally.

The company’s latest quarterly earnings were also well below analysts’ estimates. So is there any hope for Wynn investors going forward?

Andrew Keene, options trader with Keene on the Market, was on CNBC recently to answer that question.

Nothing To Be Optimistic About

“We haven’t seen any call activity really that much coming in yet,” Keene said. “This stock looks like it’s headed lower, hitting the 52-week low, down over 21 percent this year, year-over-year down 47 percent. Their Macau numbers are bad, their earnings are bad. It doesn’t seem like there’s anything that can make the stock go higher.”

A $25 Move: Either Side

“I think it is oversold, so I am not looking to put on a short position here. I use the option market to figure out how much a stock can move between now and any certain date. Between the now and the end of the year they are implying a $25 move in either direction. So, either up to $130 or down to $80.”

Short On Any Rally

“Short-term bottom are usually on a big volume day and then a reversal day. So, if there is a big reversal day making a new 52-week low, it sells off hard, big volume and then closes on the high of the day. That might be a short-term bottom, but until then, I think, it is a short on any rally,” Keene concluded. 

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Posted In: CNBCMediaAndrew Keene
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