Casinos and Gaming

Conventions could avoid Wynn hotels, killing a sizable source of revenue for the company, gaming analyst warns

Key Points
  • Events and conferences may avoid Wynn Resorts, according to Nomura analyst Harry Curtis.
  • "There's a legitimate question about brand value," Curtis says.
  • Wynn Resorts stock is down nearly 8 percent in trading Monday, after dropping over 10 percent on Friday.
There's a legitimate question about brand value for Wynn: Analyst

Wynn Resorts stock remains in danger of dropping further if booking companies decide to avoid the casino group, according to one senior gaming analyst on Monday.

Shares of the company plunged more than 10 percent Friday after The Wall Street Journal reported allegations that billionaire CEO Steve Wynn engaged in sexual misconduct over many years. Wynn stock continued to plummet in Monday trading, down 8 percent from Friday's closing price.

"There's a legitimate question about brand value," Nomura analyst Harry Curtis told CNBC's "Squawk on the Street."

Curtis emphasized what Wynn Resorts brings in through events, saying 20 to 30 percent of the business and occupancy in Las Vegas is from group meetings and conventions.

"There's an issue of whether or not there's going to be cancellations," Curtis said. "The thing to remember is: What's the batting average of CEOs surviving when they've been accused of this?"

He said solving the company's branding problem through selling is "not that easy," saying that the vast majority of Wynn Resorts cash flow "comes out of Macau."

"What determines the fate of Macau are the folks in Beijing, so I think that there could be an issue with approvals," Curtis added.

Wynn Resorts has formed a special committee to investigate the allegations against its CEO, according to a board statement on Friday.

In response to requests for further comment, Wynn Resorts pointed CNBC to the statements already made by the company and Mr. Wynn.