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MGM Resorts (MGM) Lags Q4 Earnings, Tops Revenue Estimates

Zacks

MGM Resorts International MGM is one of the leading companies in the gaming and lodging industry. The company’s properties are well-diversified within U.S. and Macau, which is the only gambling destination in China.

MGM Resorts’ earnings are benefitting from higher demand at its properties in Las Vegas on the back of improving employment rate trends and increasing tourism numbers in the region. Moreover, diversification of its resort portfolio and non-gaming options bode well. Additionally, the company’s profit growth plan is also poised to further boost profits.

MGM Resorts’ revenues, however, have been hurt by its sluggish performance in Macau over the past few quarters. Nevertheless, per the Macau Gaming Inspection and Coordination Bureau, gross gaming revenues (GGR) rose in all the three months of the quarter, thereby continuing the revival in Macau. Yet, it is to be noted that the anti-graft corruption drive undertaken by the Chinese government is still keeping VIP gamblers at bay and a complete rebound in the region will take time.

Investors should note that the consensus estimate for MGM has been trending upwards over the last 60 days. Moreover, MGM’s earnings have been mostly strong over the past few quarters. In fact, the company posted positive earnings surprises in three of the last four quarters, with an average beat of 139.40%. Meanwhile, revenues have lagged the Zacks Consensus Estimate in three of the trailing four quarters.

MGM Resorts International Price and EPS Surprise

MGM Resorts International Price and EPS Surprise | MGM Resorts International Quote


MGM currently has a Zacks Rank #2 (Buy) but that could change following MGM Resorts’ earnings report which was just released. You can see the complete list of today’s Zacks #1 Rank stocks here.

We have highlighted some of the key stats from this just-revealed announcement below:

Earnings: MGM lags on earnings. Our consensus earnings estimate called for earnings per share of 17 cents, and the company reported earnings of 11 cents per share. Investors should note that these figures take out stock option expenses.

Revenues: MGM reported revenues of $2.46 billion. This surpassed our consensus estimate of $2.44 billion.

Key Stats to Note: In the fourth quarter of 2016, net revenues at the company's wholly owned domestic resorts increased 17% year over year.

Stock Price Impact: At the time of writing, the stock price of MGM Resorts was down over 4% during pre-market trading hours following the earnings release.

Check back later for our full write up on this MGM earnings report!

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