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MGM (MGM) Up 1.4% Since Last Earnings Report: Can It Continue?
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A month has gone by since the last earnings report for MGM Resorts (MGM - Free Report) . Shares have added about 1.4% 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 drivers.
MGM Resorts' Q3 Earnings Miss Estimates, Revenues Increase Y/Y
MGM Resorts reported third-quarter 2024 results, with earnings and revenues missing the Zacks Consensus Estimate. The top line increased year over year while the bottom line declined from the prior-year's quarter figure.
During the quarter, the company reported sequential improvements in Las Vegas, driven by growth in Average Daily Rate and occupancy levels. The company emphasized advancements in digital investments and an impressive pipeline of integrated resort developments in Japan, New York and other markets to drive growth in the upcoming periods.
Earnings & Revenue Discussion
MGM Resorts reported earnings per share (EPS) of 54 cents, missing the Zacks Consensus Estimate of 58 cents. In the prior-year quarter, it incurred an adjusted EPS of 64 cents.
Total revenues were $4.18 billion, missing the Zacks Consensus Estimate of $4.22 billion by 0.9%. The top line increased 5.3% year over year on the back of strong contributions from MGM China.
MGM China
During the third quarter, MGM China's net revenues surged 14% year over year to $929.5 million. The upside can be attributed to the ramp-up of operations following the removal of COVID-19-related travel and entry restrictions in the first quarter of 2023. MGM China casino revenues were up 12% year over year to $800 million.
MGM China's adjusted property earnings before interest, taxes, depreciation, amortization and restructuring or rent costs (EBITDAR) amounted to $237.4 million compared with 226.1 million reported in the prior-year quarter.
Domestic Operations
Net revenues at Las Vegas Strip Resorts were $2.13 billion, up 1.3% year over year. The upside was driven by a rise in non-gaming revenues.
Adjusted property EBITDAR increased 2% year over year to $731 million. Casino revenues were $476 million, down 13% year over year.
Net revenues from Regional operations totaled $952.1 million, compared with $925 million reported in the prior year quarter. Adjusted property EBITDAR was approximately $300 million, compared with $293.3 reported in the prior-year quarter.
Balance Sheet & Share Repurchase
MGM Resorts ended the third quarter with cash and cash equivalents of $2.95 billion compared with $2.93 billion at 2023 end. Long-term debt at the end of the quarter was $6.23 billion, down from $6.34 billion at 2023 end.
During third-quarter 2024, MGM repurchased nearly 8 million shares for an aggregate of $326 million. As of Sept. 30, 2024, the company stated availability of approximately $946 million under its share repurchase program.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in fresh estimates.
The consensus estimate has shifted -27.64% due to these changes.
VGM Scores
Currently, MGM has a subpar Growth Score of D, though it is lagging a bit 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 C. 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 is part of the Zacks Gaming industry. Over the past month, Electronic Arts (EA - Free Report) , a stock from the same industry, has gained 8.1%. The company reported its results for the quarter ended September 2024 more than a month ago.
Electronic Arts reported revenues of $2.08 billion in the last reported quarter, representing a year-over-year change of +14.2%. EPS of $2.15 for the same period compares with $1.46 a year ago.
For the current quarter, Electronic Arts is expected to post earnings of $3.43 per share, indicating a change of +15.9% from the year-ago quarter. The Zacks Consensus Estimate has changed +0.1% over the last 30 days.
Electronic Arts has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of C.
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MGM (MGM) Up 1.4% Since Last Earnings Report: Can It Continue?
A month has gone by since the last earnings report for MGM Resorts (MGM - Free Report) . Shares have added about 1.4% 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 drivers.
MGM Resorts' Q3 Earnings Miss Estimates, Revenues Increase Y/Y
MGM Resorts reported third-quarter 2024 results, with earnings and revenues missing the Zacks Consensus Estimate. The top line increased year over year while the bottom line declined from the prior-year's quarter figure.
During the quarter, the company reported sequential improvements in Las Vegas, driven by growth in Average Daily Rate and occupancy levels. The company emphasized advancements in digital investments and an impressive pipeline of integrated resort developments in Japan, New York and other markets to drive growth in the upcoming periods.
Earnings & Revenue Discussion
MGM Resorts reported earnings per share (EPS) of 54 cents, missing the Zacks Consensus Estimate of 58 cents. In the prior-year quarter, it incurred an adjusted EPS of 64 cents.
Total revenues were $4.18 billion, missing the Zacks Consensus Estimate of $4.22 billion by 0.9%. The top line increased 5.3% year over year on the back of strong contributions from MGM China.
MGM China
During the third quarter, MGM China's net revenues surged 14% year over year to $929.5 million. The upside can be attributed to the ramp-up of operations following the removal of COVID-19-related travel and entry restrictions in the first quarter of 2023. MGM China casino revenues were up 12% year over year to $800 million.
MGM China's adjusted property earnings before interest, taxes, depreciation, amortization and restructuring or rent costs (EBITDAR) amounted to $237.4 million compared with 226.1 million reported in the prior-year quarter.
Domestic Operations
Net revenues at Las Vegas Strip Resorts were $2.13 billion, up 1.3% year over year. The upside was driven by a rise in non-gaming revenues.
Adjusted property EBITDAR increased 2% year over year to $731 million. Casino revenues were $476 million, down 13% year over year.
Net revenues from Regional operations totaled $952.1 million, compared with $925 million reported in the prior year quarter. Adjusted property EBITDAR was approximately $300 million, compared with $293.3 reported in the prior-year quarter.
Balance Sheet & Share Repurchase
MGM Resorts ended the third quarter with cash and cash equivalents of $2.95 billion compared with $2.93 billion at 2023 end. Long-term debt at the end of the quarter was $6.23 billion, down from $6.34 billion at 2023 end.
During third-quarter 2024, MGM repurchased nearly 8 million shares for an aggregate of $326 million. As of Sept. 30, 2024, the company stated availability of approximately $946 million under its share repurchase program.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in fresh estimates.
The consensus estimate has shifted -27.64% due to these changes.
VGM Scores
Currently, MGM has a subpar Growth Score of D, though it is lagging a bit 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 C. 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 is part of the Zacks Gaming industry. Over the past month, Electronic Arts (EA - Free Report) , a stock from the same industry, has gained 8.1%. The company reported its results for the quarter ended September 2024 more than a month ago.
Electronic Arts reported revenues of $2.08 billion in the last reported quarter, representing a year-over-year change of +14.2%. EPS of $2.15 for the same period compares with $1.46 a year ago.
For the current quarter, Electronic Arts is expected to post earnings of $3.43 per share, indicating a change of +15.9% from the year-ago quarter. The Zacks Consensus Estimate has changed +0.1% over the last 30 days.
Electronic Arts has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of C.