/MGM%20Resorts%20International%20resort%20at%20night%20by-%207Michael%20via%20iStock.jpg)
Las Vegas-headquartered MGM Resorts International (MGM) is a prominent operator of hotels and casinos, offering state-of-the-art meeting and conference facilities as well as live and theatrical entertainment. With a market cap of $14.7 billion, MGM’s portfolio includes 31 distinct hotel and gaming destinations worldwide, featuring renowned resort brands like Bellagio, MGM Grand, Mandalay Bay, and The Mirage. The company is scheduled to release its fiscal 2024 Q2 earnings results after the market closes on Wednesday, Jul. 31.
Ahead of the event, analysts expect MGM to report a profit of $0.67 per share, up 13.6% from $0.59 per share in the year-ago quarter. The company has exceeded Wall Street’s EPS estimates in each of the last four quarters.
MGM Resort’s EPS of $0.74 for the last reported quarter rose 68.2% year over year and beat the consensus estimate by 23.3%, driven by solid performance at MGM China and in Las Vegas, especially at its luxury resort properties.
Over the longer term, analysts expect MGM Resorts to report an EPS of $3.01 in fiscal 2024, up 12.7% from $2.67 in fiscal year 2023. Moreover, its fiscal 2025 EPS is projected to rise 6% annually to $3.19.
Over the past 52 weeks, MGM stock has plunged 4.2%, underperforming the broader S&P 500 Index's ($SPX) 23.6% gains and the Consumer Discretionary Select Sector SPDR Fund’s (XLY) 9% returns during the same period.
Despite its overall underperformance in the broader market, MGM has reaped benefits from the increased traffic at its gaming hubs in Macau, driven by a resurgence in travel and tourism spending in the world's second-largest economy.
As a result, MGM reported solid Q1 earnings results on May 1, sending the stock up 2.8% in the subsequent trading session. The company topped its EPS, adjusted EBITDA, and revenue consensus estimates and plans to drive sustainable FCF this year by investing in digital and luxury-integrated resorts.
More recently, the stock rose 4.4% in the following trading session after the company announced a new partnership on July 10, naming MGM Resorts as a "Proud Partner of the New York Yankees." The collaboration between the two organizations will offer MGM Rewards members and baseball fans exclusive VIP experiences, such as watching batting practice from the warning track and throwing out a ceremonial first pitch at Yankee Stadium, bolstering MGM’s reach and expanding its customer base.
The current consensus opinion on MGM Resorts stock is “Strong Buy” overall. Out of 17 analysts covering the stock, 15 suggest a “Strong Buy,” and the remaining two advise a “Hold.” This consensus is slightly more bullish than three months ago when 13 analysts recommended a “Strong Buy” rating.
Further, the average price target for MGM Resorts is $56.44, indicating a potential upside of 22.2% from the current price levels.
On the date of publication, Kritika Sarmah did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
