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MGM Resorts (MGM) Touches 52-Week High on Borgata Deal
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Shares of MGM Resorts International (MGM - Free Report) reached a 52-week high of $25.06 on Jun 8, 2016, eventually closing at $24.97.
The closing price of the casino operator reflects a solid year-to-date return of nearly 10%. The trading volume for the session was 6.7 million shares.
Shares of the company have increased 9% since it announced a definitive agreement to acquire 50% stake in Boyd Gaming Corporation's (BYD - Free Report) Borgata Hotel Casino & Spa on May 31, 2016.
Meanwhile, MGM Resorts’ share price has gone up by 15.2% since it announced better-than expected earnings on May 5.
The Borgata Deal
As per the agreement, MGM Resorts will pay a sum of $900 million for Borgata Hotel Casino & Spa, which is located in Atlantic City; NJ. MGM Resorts will pay approximately $600 million for the stake in Boyd Gaming, and assume and refinance Borgata's outstanding debt of approximately $600 million.
Per the deal, following the purchase of Boyd Gaming's 50% stake in Borgata, MGM Resorts will sell all of Borgata's real property to MGM Growth Properties LLC for approximately $1.18 billion. All the agreements are expected to close in the third quarter of 2016, subject to regulatory approvals and other customary closing conditions.
Borgata, a leading resort in Atlantic City, will complement MGM Resorts’ increasing presence in the northeastern U.S.
Strong Q1 Results
MGM Resorts beat the Zacks Consensus Estimate for earnings per share in the first quarter of 2016 while missing the same for revenues. Sales remained weak in Macau while performance in Las Vegas and regional resorts improved amid an improving economy and consumer spending power. Net revenue at wholly owned domestic resorts was up 3%. Excluding Circus Reno, Railroad Pass, and the company's properties in Jean Nevada that were sold in 2015, revenues grew 4%. Casino revenues from wholly owned domestic resorts improved 4% due to higher table games revenues.
MGM Resorts currently has a Zack Rank#3 (Hold).
Stock to Consider
A better-ranked stock in the same sector is Monarch Casino & Resort Inc. (MCRI - Free Report) with a Zacks Rank #2 (Buy).
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MGM Resorts (MGM) Touches 52-Week High on Borgata Deal
Shares of MGM Resorts International (MGM - Free Report) reached a 52-week high of $25.06 on Jun 8, 2016, eventually closing at $24.97.
The closing price of the casino operator reflects a solid year-to-date return of nearly 10%. The trading volume for the session was 6.7 million shares.
Shares of the company have increased 9% since it announced a definitive agreement to acquire 50% stake in Boyd Gaming Corporation's (BYD - Free Report) Borgata Hotel Casino & Spa on May 31, 2016.
Meanwhile, MGM Resorts’ share price has gone up by 15.2% since it announced better-than expected earnings on May 5.
The Borgata Deal
As per the agreement, MGM Resorts will pay a sum of $900 million for Borgata Hotel Casino & Spa, which is located in Atlantic City; NJ. MGM Resorts will pay approximately $600 million for the stake in Boyd Gaming, and assume and refinance Borgata's outstanding debt of approximately $600 million.
Per the deal, following the purchase of Boyd Gaming's 50% stake in Borgata, MGM Resorts will sell all of Borgata's real property to MGM Growth Properties LLC for approximately $1.18 billion. All the agreements are expected to close in the third quarter of 2016, subject to regulatory approvals and other customary closing conditions.
Borgata, a leading resort in Atlantic City, will complement MGM Resorts’ increasing presence in the northeastern U.S.
Strong Q1 Results
MGM Resorts beat the Zacks Consensus Estimate for earnings per share in the first quarter of 2016 while missing the same for revenues. Sales remained weak in Macau while performance in Las Vegas and regional resorts improved amid an improving economy and consumer spending power. Net revenue at wholly owned domestic resorts was up 3%. Excluding Circus Reno, Railroad Pass, and the company's properties in Jean Nevada that were sold in 2015, revenues grew 4%. Casino revenues from wholly owned domestic resorts improved 4% due to higher table games revenues.
MGM Resorts currently has a Zack Rank#3 (Hold).
Stock to Consider
A better-ranked stock in the same sector is Monarch Casino & Resort Inc. (MCRI - Free Report) with a Zacks Rank #2 (Buy).
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>