Las Vegas couldn't be going much better for Wynn Resorts (WYNN 1.70%). The company generated a whopping $226.7 million of adjusted EBITDA (a proxy for cash flow from a casino/resort) in the second quarter of 2022, nearly double what it generated a year ago.

Across the Pacific Ocean, Macao has been a huge drag on Wynn and the entire casino industry. Adjusted EBITDA was a negative $90.4 million due to more lockdowns and an uncertain future. The casino industry today really is a tale of two cities. 

Wynn Las Vegas.

Image source: Wynn Resorts.

Las Vegas is a boom town

It's hard to argue with any of the results from the Las Vegas Strip right now. At Wynn Las Vegas, Q2 revenue was up 58% year over year to $561.1 million, and adjusted EBITDA from the property was a whopping $226.7 million. There was strength across the board, with revenue per available room up 38% year over year to $368, slot machine volume up 11%, and table game volume up 20%. 

The EBITDA result was a record for a single quarter on the Las Vegas Strip, and it would put the company on pace for an incredible $900 million EBITDA year. 

The Boston operations weren't too bad either, with revenue up 27% year over year to $210.2 million and adjusted EBITDA of $63.7 million. That's a fraction of Las Vegas, but the property is smaller and doesn't have as much non-gaming revenue from hotel rooms, restaurants, and shopping. 

Macao's terrible quarter

It shouldn't surprise anyone watching the casino industry to see Wynn's two Macao properties do terribly in the quarter. The entire region was in lockdown for part of the quarter, and revenue essentially dropped to zero. 

Wynn Palace's revenue was just $58.7 million, and Wynn Macao had $58.6 million in revenue. They lost a combined $90.4 million in adjusted EBITDA. 

Operating metrics show just how bad conditions have gotten. VIP table game volume fell 80% year over year, mass market table volume fell 68%, and revenue per available room was down 65% to $47. And these were off already depressed pandemic numbers in 2021. 

Wynn's upside is still impressive

What do we make of Wynn's results right now? In the U.S., business is booming and the company just reported a quarter that would put it on pace for $1.16 billion in adjusted EBITDA in the U.S. alone. But that's barely enough to service $11.9 billion in debt, much less return money to shareholders. 

Wynn Resorts still needs a recovery in Macao for the stock to perform well. But if Macao does return, the stock right now could provide an extremely cheap entry point. In 2019, before the pandemic began, Macao generated $1.8 billion in EBITDA. If it returns to that level, it would be generating about $3 billion in EBITDA per year. 

Right now, the company's enterprise value (market cap plus total debt-cash) is $17.5 billion. That's an implied enterprise-value-to-EBITDA ratio of under six. 

Betting on a Macao recovery is risky, but if it happens this is a stock that could easily double or more, which makes me bullish on the stock long-term.