The 5 Scariest Stocks to Have in Your Portfolio

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Scary Stock #5: Wynn Resorts (WYNN)

Wynn Resorts' (WYNN) Steve Wynn is a guy I really love. He went from a bingo parlor operator to the world's most famous and innovative casino operator -- all while battling near-blindness from retinitis pigmentosa. He brought Frank Sinatra, the Mirage, Bellagio and the Wynn to Las Vegas, bought this, sold that and just brought $1.5 billion back home by cashing in on an IPO for his Macau venture.

He is one cool customer, but financial success in stock markets does not mean people are spending more money -- in fact, they are spending less. There will not be much growth in Las Vegas or Macau. In fact, I believe Las Vegas is gong to be seriously impaired for at least several years, and WYNN is radically overvalued.

Most importantly, in the short term, the stock is headed down and just dipped below its exponential six-month moving average, and is now hovering just above its 50-day moving average. Oh, and it is selling for 100 times earnings.

Finally, Mr. Wynn does not have a history of returning cash to investors; rather, he spends it on new hotels and casinos.

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