I was in communication with a respected trader recently on his views of Wynn Resorts and Casinos (symbol: WYNN)…I disagree that it is about to fall 30 points as he believes…I told friend recently that I think WYNN could be a long term winner…by long term, I think 2 to 4 months from now based on that double-bottom TRIX reading and triple bottom MACD reading. Sure, it’s a short in the very near term…I said that the other day, but I think you’rethis other fella is wrong about the next 2 to 4 months out.
BTW, how can he say that a death cross is imminent when the two lines (50 and 200) are more than $10 apart??? The 50 line has just barely started to dip…I think there is time, if the numbers improve, to avoid a death cross.
Also,I just read in Kopin Tan’s weekly blog (in Barron’s and Barrons.com) that WYNN is sitting on a horde of cash and has many insiders…that could potentially declare a special dividend in the 2nd half of this year before the Bush tax cuts expire…
The idea here is that WYNN’s insider shareholders may float a proposal to pay out a special one time dividend while the dividend tax remains capped at 15%. Next year, the tax will likely jump at high as 39.6% for top bracket folks.
If they pay out a special divvy this year, the price could rally in the days before the payout…once the payout occurs, the price could collapse…so, get this: if the price collapses after a payout, the insiders will have a capital gains loss which can be used to offset winnings from eleswhere (assuming a more recent higher cost basis…but even a longer term lower basis might suffer less once price drops after divvy payout), and up to $3,000 will be taxed at the current 15% LT cap gains rate…next year, that goes to 20%.
…and they also pay only 15% on the dividend tax this year…vs. up to 39.6% for next year. Barron’s suggested a few others that could possibly do the same…another one was AMZN…can’t recall the rest right now…
Now that I think about it, that is the only way one might get a 30 point selloff on WYNN! On a technical correction, as the price might correct after such a large dividend payout! (laugh!)