MGM Resorts (NYSE:MGM) International's stock has faced significant headwinds, touching a 52-week low of $33.62. The renowned hospitality and entertainment company, which operates a portfolio of iconic destinations in Las Vegas and beyond, has seen its shares struggle in a challenging market environment. Over the past year, MGM's stock has experienced a notable decline, with a 1-year change showing a decrease of 21.14%. This downturn reflects broader economic concerns and potentially company-specific factors that investors are closely monitoring.
In other recent news, BetMGM, a U.S. sports-betting service, projects a rise in revenue for the latter half of this year and continuing into 2025, driven by the National Football League (NFL) season's appeal to bettors. The company's success in surpassing its targets in both customer acquisition and retention is expected to translate into increased year-over-year revenue.
In related developments, BTIG initiated coverage on MGM Resorts International with a Buy rating and a $52.00 price target. The firm highlighted the potential for upward revisions of estimates due to performance in Las Vegas and China and anticipates healthy capital returns. BTIG also drew attention to the underappreciated potential of MGM's digital operations overseas, predicting that the revenue and EBITDA for this segment could outperform consensus estimates by two to four times as the business expands.
Furthermore, MGM Resorts International has been the subject of several analyst upgrades following robust first quarter results for 2024. Susquehanna analyst Joseph Stauff upgraded the company from Neutral to Positive and increased the price target to $54. Deutsche Bank (ETR:DBKGn) maintained a Buy rating on MGM's shares and raised the stock's price target from $53.00 to $57.00.
Lastly, MGM Resorts reported a 13% increase in net revenues, reaching $4.4 billion in the first quarter of 2024. The company experienced significant growth in its operations in Las Vegas and Macau, along with substantial progress in its digital and international expansion strategies.
InvestingPro Insights
MGM Resorts International's recent stock performance paints a picture that prospective investors should examine with a keen eye. According to InvestingPro data, MGM's market capitalization stands at $10.26 billion, with a trailing P/E ratio of 13.4, indicating that the stock may be reasonably valued in the context of its earnings. Interestingly, the stock's PEG ratio, which measures the price of a stock relative to its earnings growth, is exceptionally low at 0.07 for the last twelve months as of Q2 2024, suggesting potential undervaluation based on future earnings growth expectations.
InvestingPro Tips highlight that management's aggressive share buybacks and a high shareholder yield could be seen as a vote of confidence in the company's future, despite the fact that net income is expected to drop this year. Additionally, with 8 analysts revising their earnings upwards for the upcoming period, there seems to be optimism regarding MGM's ability to navigate through the current economic landscape.
Moreover, the stock's price movements have been quite volatile, with a 1-week total return of -17.06% and a 1-month total return of -17.57%, reflecting the stock's sensitivity to market fluctuations. Yet, it's worth noting that MGM's liquid assets exceed its short-term obligations, which provides some financial stability.
For investors seeking more detailed analysis, InvestingPro offers additional tips and insights on MGM Resorts International, which can be found at https://www.investing.com/pro/MGM. With the next earnings date approaching on October 30, 2024, keeping an eye on these metrics and tips could be crucial for those interested in MGM's stock.
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