Benzinga - It was not all bad news for all stocks on Monday morning. One issue that is having a good day is Wynn Resorts (NASDAQ:WYNN), Limited (NASDAQ: WYNN), and it's even one that has exposure to China. The catalysts for the rally and the corresponding price action make Wynn Resorts the PreMarket Prep Stock of the Day.
Wynn On A Roll: In late October, the issue was laboring in the lower $50 handle, bottoming at $53.81. The only thing the bulls had going in their favor: the issue was trading above its low for the year, made in June at $50.20.
The rally was kickstarted on Oct. 31, when gambling mogul Tilman Fertitta announced a large stake in the company. In the session, the issue rallied from $58.30 to $63.90 on heavy volume, The following day, relaxed COVID restrictions were announced and the issue tacked on nearly another $4, moving up to $67.85.
Meanwhile, some love from Wall Street analysts and a rally in the broad market took the issue to its high for the move ($80.50) and closing high ($78.40) on Nov. 15. Profit taking over the next seven sessions nudged the stock down to $74.93 to end last week.
Double Catalyst For Wynn: It was not all bad news coming out of China this morning. Six casino operators in Macau, including Wynn Resorts, have been granted new licenses to continue their operations in the gambling mecca. The move comes amid the acceleration of the Chinese government's reimposition of the zero COVID policy.
In addition, JPMorgan (NYSE:JPM) hopped on the business bandwagon and upgraded the issue to Overweight and raised its price target to $91.
PreMarket Prep's Take: When the issue was being covered on the show Monday, it had already established its premarket high of $80.50 and was trading actively at the $79 area. That was over $4 above Friday’s closing price of $74.93.
Co-host Dennis Dick stated: “This a beaten down stock that has volatile earnings. With the tensions in China and possible recession, there are easier longs out there.”
The author of this article alerted investors that the premarket high coincided with the recent high for the move and was a formidable target on the upside. On the downside, investors looking to go long the issue should focus on the former resistance (a trio of highs at the $75.50 area) to now act as a support level on retreat.
WYNN Price Action: In the wild first 30 minutes of the session, the issue attempted to reach the $80 handle off the open but was turned back at $79.50 and reversed course. The ensuing decline took the issue right to the aforementioned support level and it bottomed at $75.62.
As of 1:15 p.m. EST, Wynn had rebounded and was attempting to remain in the $78 handle. The closing high for the recent rally stands at $78.40.
The stock was trading 4.45% higher at $78.26 at last check.
The discussion on Wynn from Monday’s show can be found here:
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