{"id":5585,"date":"2009-11-10T13:13:47","date_gmt":"2009-11-10T18:13:47","guid":{"rendered":"http:\/\/www.thedisciplinedinvestor.com\/blog\/?p=5585"},"modified":"2016-09-20T05:18:29","modified_gmt":"2016-09-20T09:18:29","slug":"steve-wynn-wynn-a-flippn-genius","status":"publish","type":"post","link":"https:\/\/thedisciplinedinvestor.com\/blog\/2009\/11\/10\/steve-wynn-wynn-a-flippn-genius\/","title":{"rendered":"Steve Wynn (WYNN) – A Flipp’n Genius"},"content":{"rendered":"

Ahhhh. They say that, “it takes money to make money.” And, Steve Wynn knows that all too well. He is a genius extraordinaire that has gobs of money and just made more.\"57268681MB111_MAXIM_Magazin\"<\/a> This last play even helped him save a ton of taxes to boot…<\/p>\n

Remember over the last 2 weeks when Wynn Resorts (WYNN) shares were on a roller-coaster? The company had a successful IPO of the Wynn Macau property to the tune of $1.3billion and then refinanced about $500 million of debt. Then came the awful earnings report that took the stock down hard. (Client accounts<\/a> were short into the earnings and covered for a nice profit<\/a>)<\/p>\n

On the heels of that we hear that the company pulls out<\/a> of the Aqueduct Racino project.<\/p>\n

But the best was today’s news that has to makes you really squint, nod and say; nice job Steve!<\/p>\n

Let’s look at why Mr. Wynn is laughing all the way to the bank:<\/p>\n

    \n
  1. First, let us recall that Mr. Wynn is of the belief that this administration is spending far too much in a reckless manner and that taxes are sure to go up, so….,<\/li>\n
  2. Wynn IPOs the Macau property as they know this is an overheated market and any hook will be bitten<\/a> by investors<\/li>\n
  3. From that IPO, $1.3 billion is the final take on that gamble and is going to be used for general purposes (help with the ailing Vegas properties we are told),<\/li>\n
  4. Investors get the idea that Wynn now has the cash to survive the las Vegas disaster for a considerable time, even if things do not improve for a while,<\/li>\n
  5. Issue a whopping special dividend of $4 per share and initiate a regular quarterly dividend,<\/li>\n
  6. Any WYNN buyback plan may be initiated and perhaps insiders and others buy up to push the share price,<\/li>\n
  7. As a result, short positions cover as they know that they will be liable for the large dividend payment – starting a short-cover squeeze in the shares (1.83 short interest as of latest report)<\/li>\n
  8. When the dividend is paid, the stock will see a resulting drop of $4 – selling after this could provide a short-term capital loss at ordinary income rate rate for anyone who recently bought shares into the dividend.<\/li>\n
  9. Steve Wynn, personally holding 46,702,639 shares will receive a payout of $186,810,556. (From 8\/13\/09 13D filing<\/a> – pdf)<\/li>\n
  10. The payout of the special dividend will be taxed at the lowest rate, now at 15% – saving him 5% over the long-term capital gains rate if he were to sell his shares,<\/li>\n
  11. The end result is that Mr. Wynn essentially sold his part of the company at a premium through the IPO process and pays only 15% tax on the proceeds,<\/li>\n
  12. Finally, he artfully avoids the publicity that usually surrounds the news that the CEO is selling $88,613,668 of shares \u00a0 – \u00a0 usually a no-confidence vote that concerns investors.<\/li>\n<\/ol>\n

    A good deal? You do the math…. Well Steve, well done indeed!<\/p>\n

    Next up: \u00a0 Sheldon Adelson<\/span>, Las Vegas Sands (LVS) a $3billion+ IPO \u00a0 coming to China within weeks.<\/p>\n

    \"wynn\"<\/a><\/p>\n

    ______<\/p>\n

    Disclosure: Horowitz & Company<\/a> clients may hold positions of securities mentioned as of the date published.<\/p>\n","protected":false},"excerpt":{"rendered":"

    Ahhhh. They say that, “it takes money to make money.” And, Steve Wynn knows that all too well. He is a genius extraordinaire that has gobs of money and just made more. This last play even helped him save a ton of taxes to boot… Remember over the last 2 weeks when Wynn Resorts (WYNN) […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_et_pb_use_builder":"","_et_pb_old_content":"","_et_gb_content_width":"","footnotes":""},"categories":[12,42,253],"tags":[483,497],"class_list":["post-5585","post","type-post","status-publish","format-standard","hentry","category-markets","category-stocks","category-strategy","tag-markets","tag-strategy","et-doesnt-have-format-content","et_post_format-et-post-format-standard"],"acf":[],"_links":{"self":[{"href":"https:\/\/thedisciplinedinvestor.com\/blog\/wp-json\/wp\/v2\/posts\/5585","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/thedisciplinedinvestor.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/thedisciplinedinvestor.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/thedisciplinedinvestor.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/thedisciplinedinvestor.com\/blog\/wp-json\/wp\/v2\/comments?post=5585"}],"version-history":[{"count":0,"href":"https:\/\/thedisciplinedinvestor.com\/blog\/wp-json\/wp\/v2\/posts\/5585\/revisions"}],"wp:attachment":[{"href":"https:\/\/thedisciplinedinvestor.com\/blog\/wp-json\/wp\/v2\/media?parent=5585"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/thedisciplinedinvestor.com\/blog\/wp-json\/wp\/v2\/categories?post=5585"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/thedisciplinedinvestor.com\/blog\/wp-json\/wp\/v2\/tags?post=5585"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}