Trefis Top 5 – May 6 Insights (WYNN, UL, NDAQ, SPWRA, FCX)
Today we look at the outlook for Wynn Resorts (NASDAQ: WYNN) given the robust growth in Macau. Unilever (NYSE:UL) announces plans to open a large production facility in China as part of its strategy to further penetrate the world’s most populous country. We assess the outlook for Nasdaq OMX Group (NYSE:NDAQ) based on the growth outlook for listed options and Nasdaq’s plans to stymie market share declines. Total (NYSE:TOT) is looking to launch a friendly tender offer for Nasdaq OMX Group (NYSE:NDAQ) to own 60% of its A & B class shares. Finally, we look at Freeport McMoran Copper’s (NYSE:FCX) earnings and the outlook given the recent swings in commodity prices.
Macau Growth Impresses, Lifting Wynn Estimates
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Wynn Resorts (NASDAQ: WYNN) reported better than expected Q1 earnings a few weeks back driven by strong earnings from Macau operations, which we look at below. Revenue in Q1 increased by near 47% at Wynn Macau and by 24% in the Las Vegas operations. We also note that Las Vegas results came in firm which bodes well for Wynn as well as Las Vegas Sands (NYSE:LVS) and MGM Resorts International (NYSE:MGM). We have updated our price estimate for Wynn Resorts stock from $118 to $135, primarily due to an above average growth outlook for the Macau region and the recovery in the Las Vegas casino industry. Our price estimate is about 7% shy of the market price.
Unilever Bulks Up in China
Unilever (NYSE:UL), the second largest consumer goods company in the world, after Procter & Gamble (NYSE:PG), recently announced plans to build one of its largest production bases in China. Unilever already has sales worth over $20 billion in China and anticipates a substantial increase in this figure in the years ahead. [1] China, the world’s second-largest economy, has been contributing double-digit growth to consumer giants like P&G, Colgate-Palmolive (NYSE:CL) and Kimberly-Clark (NYSE:KMB). Given the country’s massive population and rising income levels, the growth opportunity is very promising.
3 Key Trends for Nasdaq OMX
Nasdaq OMX Group (NYSE:NDAQ) is a leading global exchange group that delivers trading, exchange technology, securities listing, and public company services across six continents. It is the largest cash equities securities market in the U.S. in terms of listed companies and in the world in terms of share value traded. As of December 31st, the NASDAQ Stock Market was home to 2,778 listed companies with a combined market capitalization of approximately $4.6 trillion. Nasdaq competes with NYSE Euronext (NYSE:NYX), CME Group (NYSE:CME), BATS Global and other regional exchanges.
Total Looks to Grab 60% of SunPower’s Equity
SunPower (NASDAQ:SPWRA) recently announced that the Total Group would soon be launching a friendly tender offer to buy 60% of the solar industry giant’s outstanding class A and class B equity shares. [2] SunPower manufactures and distributes silicon-based solar cells and also produces solar power products for installation on residential and commercial units. The company’s primary competitors include First Solar (NASDAQ:FSLR), SuntechPower (NYSE:STP), and Yingli Green Energy Holding Com (NYSE:YGE).
Rising Metal Prices Lift Freeport
Freeport McMoran Copper’s (NYSE:FCX) performance for the first quarter of 2011 showed improved earnings across all divisions, primarily due to steadily increasing prices of the company’s principal commodities – copper, gold and molybdenum. [3] Freeport has mining and smelting operations in North and South America, Indonesia and Africa, and operates the Grasberg mine located at Papua, Indonesia – the world’s largest copper and gold mine in terms of reserves. Freeport competes with other miners such as Southern Copper (NYSE:PCU), Codelco and Newmont Mining (NYSE:NEM).
Notes:- Unilever hoping to clean up China, China.org, May 3’ 2011 [↩]
- SunPower and Total Partner to Create a New Global Leader in the Solar Industry, SunPower Press Releases, April 28 2011 [↩]
- Freeport McMoran First Quarter 2011 Results, Company Press Releases, April 20 2011 [↩]