MGM Resorts (MGM) AI Stock Analysis

• Market Cap: $8.90B
• Dividend Yield: N/A
• Average Volume (3M): 4.85M
• Price to Earnings (P/E): 18.2
• Beta (1Y): 1.40
• Revenue Growth: 0.89%
• EPS Growth: -31.56%
• Country: US
• Employees: 60,000
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Gambling, Resorts & Casinos
• EPS (TTM): 0.79
• Shares Outstanding: 272,191,040
• 10 Day Avg. Volume: 4,581,018
• 30 Day Avg. Volume: 4,854,287
• PEG Ratio: -0.59
• Price to Book (P/B): 3.52
• Price to Sales (P/S): 0.62
• P/FCF Ratio: 8.79
• Enterprise Value/Market Cap: 4.48
• Enterprise Value/Revenue: 2.32
• Enterprise Value/Gross Profit: 5.15
• Enterprise Value/Ebitda: 17.67
• 1Y Price Target: $48.27
• Price Target Upside: 45.96% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 14

• Rating: 64 Neutral
• Price Target: $37.00 ▲(11.88% Upside)

MGM Resorts' overall stock score is driven by strong earnings call results and robust revenue growth, despite challenges in profitability margins and high leverage. The technical indicators suggest a bearish trend, but strategic initiatives and global diversification provide a positive outlook.

Positive Factors

Revenue Growth

Record-high revenues indicate strong market demand and effective business strategies, supporting long-term growth potential.

Digital and International Expansion

Successful digital and international expansion enhances revenue diversification and positions MGM well in emerging markets.

Regional Properties' Success

Strong performance in regional properties demonstrates effective local market penetration and operational efficiency.

Negative Factors

High Leverage

High leverage increases financial risk and may limit the company's ability to invest in growth opportunities or weather downturns.

Profitability Margins Decline

Declining profitability margins can erode earnings and reduce the company's ability to reinvest in its business, impacting long-term sustainability.

Challenges in Las Vegas

Operational challenges in a key market like Las Vegas can affect overall financial performance and hinder growth prospects.

MGM Resorts Business Overview & Revenue Model

Company Description

MGM Resorts International, through its subsidiaries, owns and operates casino, hotel, and entertainment resorts in the United States and Macau. The company operates through three segments: Las Vegas Strip Resorts, Regional Operations, and MGM China. Its casino resorts offer gaming, hotel, convention, dining, entertainment, retail, and other resort amenities. The company's casino operations include slots and table games, as well as online sports betting and iGaming through BetMGM. As of February 17, 2021, its portfolio consisted of 29 hotel and destination gaming offerings. The company also owns and operates Las Vegas Strip Resorts and Fallen Oak golf course. Its customers include premium gaming customers; leisure and wholesale travel customers; business travelers; and group customers, including conventions, trade associations, and small meetings. The company was formerly known as MGM MIRAGE and changed its name to MGM Resorts International in June 2010. MGM Resorts International was incorporated in 1986 and is based in Las Vegas, Nevada.

How the Company Makes Money

MGM Resorts generates revenue primarily through its gaming operations, which include casino games, slot machines, and sports betting. A significant portion of its income is derived from hotel room bookings, with the company operating thousands of hotel rooms across its properties. Additional revenue streams include food and beverage sales from its numerous restaurants and bars, as well as entertainment offerings such as concerts, shows, and events. MGM also has partnerships with various organizations and brands that enhance its offerings and drive customer engagement. Furthermore, the company's membership in loyalty programs, such as M life Rewards, incentivizes repeat business and customer retention, contributing to its overall earnings.

MGM Resorts Financial Statement Overview

Summary

MGM Resorts demonstrates strong operational efficiency with solid profit margins and cash flow generation. However, stagnant revenue growth and high leverage indicate potential risks and the need for balance sheet strengthening.

Income Statement

MGM Resorts shows solid performance with a positive gross profit margin of 57.8% for TTM, indicating efficient revenue generation. Net profit margin improved to 4.9%, reflecting better cost control. However, revenue growth is slightly negative at -0.6% compared to the previous year, indicating a need for top-line expansion. EBIT and EBITDA margins remain stable at 8.6% and 13.0%, respectively, showcasing operational efficiency with a need for increased revenue growth.

Balance Sheet

The balance sheet shows high leverage with a debt-to-equity ratio of 9.07, pointing to significant reliance on debt. Return on equity stands at a modest 29.3%, indicating decent profitability relative to equity. The equity ratio is a low 6.95%, highlighting potential risk due to high liabilities. Strengthening equity and reducing debt could improve financial stability.

Cash Flow

MGM's cash flow is robust with a healthy operating cash flow to net income ratio of 2.81, indicating strong cash generation relative to earnings. Free cash flow to net income ratio is solid at 1.36, ensuring sufficient cash to cover investments. However, free cash flow growth is negative at -6.05%, suggesting a drop in cash available for expansion.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	17.21B	17.24B	16.16B	13.13B	9.68B	5.16B
Gross Profit	7.74B	7.85B	7.61B	6.47B	4.65B	1.71B
EBITDA	2.26B	2.39B	2.75B	1.77B	1.71B	558.86M
Net Income	539.51M	746.56M	1.14B	206.73M	1.25B	-1.32B
Balance Sheet
Total Assets	41.70B	42.23B	42.37B	45.69B	40.90B	36.49B
Cash, Cash Equivalents and Short-Term Investments	1.96B	2.42B	2.93B	5.91B	4.70B	5.10B
Total Debt	31.59B	31.61B	31.62B	33.99B	24.69B	21.02B
Total Liabilities	37.96B	38.51B	38.00B	40.32B	29.77B	25.25B
Stockholders Equity	2.97B	3.02B	3.81B	4.83B	6.07B	6.50B
Cash Flow
Free Cash Flow	1.30B	1.21B	1.76B	991.39M	882.73M	-1.76B
Operating Cash Flow	2.53B	2.36B	2.69B	1.76B	1.37B	-1.49B
Investing Cash Flow	-1.50B	-1.28B	-714.17M	2.12B	1.54B	2.16B
Financing Cash Flow	-1.53B	-1.56B	-5.00B	-3.02B	-2.81B	2.10B

MGM Resorts Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 33.07
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MGM, the sentiment is Negative. The current price of 33.07 is below the 20-day moving average (MA) of 33.16, below the 50-day MA of 35.19, and below the 200-day MA of 33.93, indicating a bearish trend. The MACD of -0.80 indicates Negative momentum. The RSI at 46.87 is Neutral, neither overbought nor oversold. The STOCH value of 84.43 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for MGM.

MGM Resorts Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
BYD	74 Outperform	$6.65B	3.72	―	0.84%	5.91%	336.91%
LVS	69 Neutral	$34.75B	25.69	―	1.88%	8.37%	10.20%
RRR	69 Neutral	$6.34B	22.89	97.52%	3.25%	7.47%	2.58%
MGM	64 Neutral	$8.90B	18.22	17.34%	―	0.89%	-31.56%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
CZR	57 Neutral	$4.72B	―	-4.76%	―	-0.15%	28.05%
WYNN	53 Neutral	$12.41B	36.99	―	0.80%	-1.94%	-53.90%