TLDR
- MGM shares advanced 2.32% to reach $36.68 on Wednesday, marking consecutive daily gains
- Fourth-quarter earnings per share hit $1.60, demolishing analyst projections of $0.64 by $0.96
- Quarterly revenue reached $4.61B, surpassing Wall Street’s $4.42B forecast
- IAC Inc. acquired approximately 1.1 million shares at $36.30 per share, investing ~$39.9M
- TD Asset Management dramatically expanded its position by 146.9%, purchasing 55,300 additional shares in Q3
MGM Resorts International enjoyed a successful trading session Wednesday, advancing 2.32% to settle at $36.68. This represented the second consecutive session of upward momentum for the casino operator.
MGM Resorts International, MGM
The upward movement occurred during a generally favorable market environment. The S&P 500 climbed 0.78% while the Dow Jones Industrial Average gained 0.49%.
Despite recent strength, MGM remains 8.67% under its 52-week peak of $40.16, established on August 28th. The shares bottomed at $25.30 over the past year.
Daily trading activity registered 4.4 million shares, falling approximately 343,636 below the 50-day average volume of 4.8 million.
Compared to industry competitors, performance varied. DraftKings topped the sector with a 4.01% advance. Caesars Entertainment climbed 2.16%, and Las Vegas Sands edged up 0.66%.
Earnings Beat
MGM’s latest quarterly financial results, disclosed on February 4th, demonstrated impressive performance across key metrics.
The gaming and hospitality giant reported quarterly EPS of $1.60, significantly exceeding the Street consensus of $0.64 by $0.96. This represented substantial improvement from the $0.45 posted during the comparable year-ago period.
Quarterly revenue totaled $4.61 billion, topping the analyst consensus estimate of $4.42 billion.
The company achieved return on equity of 26.04%, alongside a net margin of 1.17%. Wall Street currently projects full-year EPS of $2.21.
Institutional and Insider Activity
Regarding institutional ownership, numerous prominent investment firms have substantially increased their MGM holdings in recent reporting periods.
Helikon Investments expanded its stake by an impressive 379.9% during Q2, accumulating 8.81 million shares valued at approximately $303 million.
Davis Selected Advisers increased its holdings by 14.4%, reaching 23.82 million shares worth $819 million. Arrowstreet Capital dramatically grew its position by 119.6%, now holding 4.21 million shares.
Norges Bank initiated a fresh position valued at roughly $60.6 million. Goldentree Asset Management increased holdings by 20.7%, expanding to 5.4 million shares worth $185.8 million.
TD Asset Management significantly amplified its stake by 146.9% during Q3, purchasing an additional 55,300 shares to reach 92,957 total shares, valued at $3.22 million according to the most recent filing.
Institutional investors combined control 68.11% of MGM’s outstanding shares.
Regarding insider transactions, significant shareholder IAC Inc. purchased 1,098,748 shares on December 5th at $36.30 per share, representing a transaction value of roughly $39.9 million. IAC’s total position now stands at 65.8 million shares, valued at approximately $2.39 billion. Company insiders collectively own 3.06% of outstanding shares.
Wall Street analyst opinions remain divided. The consensus recommendation stands at “Hold” with an average price objective of $41.94.
Susquehanna reduced its price target from $46 to $45 while maintaining a “positive” outlook. JPMorgan elevated its target from $39 to $41 with a “neutral” stance. Barclays established a $37 price target. UBS maintains a “neutral” rating alongside a $37 target. Goldman Sachs continues with a “sell” rating and $33 price objective.
Among 20 analysts providing coverage, one assigns a Strong Buy rating, eight recommend Buy, seven suggest Hold, and four rate it Sell.
MGM presently trades at a price-to-earnings ratio of 48.89, sporting a market capitalization of $9.38 billion and a beta coefficient of 1.38. The stock’s 50-day moving average stands at $35.41, while the 200-day moving average sits at $34.96.
