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Why Is MGM (MGM) Up 4.2% Since Last Earnings Report?
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It has been about a month since the last earnings report for MGM Resorts (MGM - Free Report) . Shares have added about 4.2% in that time frame, underperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is MGM due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
MGM Resorts’ Q3 Earnings And Revenues Beat Estimates
MGM Resorts reported third-quarter 2023 results, with earnings and revenues surpassing the Zacks Consensus Estimate. The top and bottom lines increased on a year-over-year basis.
Earnings & Revenue Discussion
MGM Resorts reported earnings per share of 64 cents, outpacing the Zacks Consensus Estimate of 55 cents. In the prior-year quarter, it incurred adjusted loss per share of $1.39.
Total revenues were $3,973.2 million, outshining the Zacks Consensus Estimate of $3,846 million by 3.3%. The top line improved 16% year over year on the back of a rise in revenues at MGM China following the removal of COVID-19-related entry restrictions in Macau. This was marginally offset by a decline in revenues at MGM’s Las Vegas Strip Resorts and Regional operations due to dispositions of The Mirage and Gold Strike Tunica as well as the cybersecurity issue in September 2023.
MGM China
During the third quarter, MGM China's net revenues surged 829% year over year to $813 million. The upside was attributed to the removal of COVID-19-related travel restrictions in Macau and an increase in visitation. Our model predicted the metric to jump 791.2% year over year. MGM China casino revenues were up 915% year over year to $714 million.
MGM China's adjusted property earnings before interest, taxes, depreciation, amortization, and restructuring or rent costs (EBITDAR) amounted to $226 million compared with ($70) million in the prior-year quarter.
Domestic Operations
Net revenues at Las Vegas Strip Resorts were $2.1 billion, down 8% year over year. Our model suggested the metric to fall 12.5% year over year.
Adjusted property EBITDAR plunged 16% year over year to $714 million.Casino revenues were $546 million, down 5% year over year.
Net revenues from Regional operations totaled $925 million, down 5% from the prior-year levels. This was primarily caused by the dispositions of The Mirage and Gold Strike Tunica as well as the cybersecurity issue in September 2023. We predicted the metric to decrease 16% year over year. Casino revenues of $679 million tumbled 7% from prior-year actuals.
Adjusted property EBITDAR was $293 million, down 9% from the prior-year quarter. Adjusted property EBITDAR margin contracted 140 basis points year over year to 31.7%.
Balance Sheet & Share Repurchase
MGM Resorts ended the third quarter with cash and cash equivalents of $3,316.4 million compared with $5,911.9 million in 2022 end. Long-term debt at the end of the quarter was $6,505.5 million, down from $7,432.8 million at 2022 end.
During the third quarter of 2023, MGM repurchased nearly 13 million shares for an aggregate of $572 million. As of Sep 30, the company stated the availability of $806 million under its February 2023 repurchase program.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates revision.
The consensus estimate has shifted -19.3% due to these changes.
VGM Scores
Currently, MGM has a great Growth Score of A, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of A on the value side, putting it in the top 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, MGM has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Performance of an Industry Player
MGM belongs to the Zacks Gaming industry. Another stock from the same industry, International Game Technology (IGT - Free Report) , has gained 0.2% over the past month. More than a month has passed since the company reported results for the quarter ended September 2023.
IGT reported revenues of $1.07 billion in the last reported quarter, representing a year-over-year change of +0.5%. EPS of $0.52 for the same period compares with $1.30 a year ago.
For the current quarter, IGT is expected to post earnings of $0.35 per share, indicating a change of -12.5% from the year-ago quarter. The Zacks Consensus Estimate remained unchanged over the last 30 days.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for IGT. Also, the stock has a VGM Score of B.
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Why Is MGM (MGM) Up 4.2% Since Last Earnings Report?
It has been about a month since the last earnings report for MGM Resorts (MGM - Free Report) . Shares have added about 4.2% in that time frame, underperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is MGM due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
MGM Resorts’ Q3 Earnings And Revenues Beat Estimates
MGM Resorts reported third-quarter 2023 results, with earnings and revenues surpassing the Zacks Consensus Estimate. The top and bottom lines increased on a year-over-year basis.
Earnings & Revenue Discussion
MGM Resorts reported earnings per share of 64 cents, outpacing the Zacks Consensus Estimate of 55 cents. In the prior-year quarter, it incurred adjusted loss per share of $1.39.
Total revenues were $3,973.2 million, outshining the Zacks Consensus Estimate of $3,846 million by 3.3%. The top line improved 16% year over year on the back of a rise in revenues at MGM China following the removal of COVID-19-related entry restrictions in Macau. This was marginally offset by a decline in revenues at MGM’s Las Vegas Strip Resorts and Regional operations due to dispositions of The Mirage and Gold Strike Tunica as well as the cybersecurity issue in September 2023.
MGM China
During the third quarter, MGM China's net revenues surged 829% year over year to $813 million. The upside was attributed to the removal of COVID-19-related travel restrictions in Macau and an increase in visitation. Our model predicted the metric to jump 791.2% year over year. MGM China casino revenues were up 915% year over year to $714 million.
MGM China's adjusted property earnings before interest, taxes, depreciation, amortization, and restructuring or rent costs (EBITDAR) amounted to $226 million compared with ($70) million in the prior-year quarter.
Domestic Operations
Net revenues at Las Vegas Strip Resorts were $2.1 billion, down 8% year over year. Our model suggested the metric to fall 12.5% year over year.
Adjusted property EBITDAR plunged 16% year over year to $714 million.Casino revenues were $546 million, down 5% year over year.
Net revenues from Regional operations totaled $925 million, down 5% from the prior-year levels. This was primarily caused by the dispositions of The Mirage and Gold Strike Tunica as well as the cybersecurity issue in September 2023. We predicted the metric to decrease 16% year over year. Casino revenues of $679 million tumbled 7% from prior-year actuals.
Adjusted property EBITDAR was $293 million, down 9% from the prior-year quarter. Adjusted property EBITDAR margin contracted 140 basis points year over year to 31.7%.
Balance Sheet & Share Repurchase
MGM Resorts ended the third quarter with cash and cash equivalents of $3,316.4 million compared with $5,911.9 million in 2022 end. Long-term debt at the end of the quarter was $6,505.5 million, down from $7,432.8 million at 2022 end.
During the third quarter of 2023, MGM repurchased nearly 13 million shares for an aggregate of $572 million. As of Sep 30, the company stated the availability of $806 million under its February 2023 repurchase program.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates revision.
The consensus estimate has shifted -19.3% due to these changes.
VGM Scores
Currently, MGM has a great Growth Score of A, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of A on the value side, putting it in the top 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, MGM has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Performance of an Industry Player
MGM belongs to the Zacks Gaming industry. Another stock from the same industry, International Game Technology (IGT - Free Report) , has gained 0.2% over the past month. More than a month has passed since the company reported results for the quarter ended September 2023.
IGT reported revenues of $1.07 billion in the last reported quarter, representing a year-over-year change of +0.5%. EPS of $0.52 for the same period compares with $1.30 a year ago.
For the current quarter, IGT is expected to post earnings of $0.35 per share, indicating a change of -12.5% from the year-ago quarter. The Zacks Consensus Estimate remained unchanged over the last 30 days.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for IGT. Also, the stock has a VGM Score of B.