قالب وردپرس درنا توس
Home / Business / No dice for MGM Resorts International

No dice for MGM Resorts International



Some casino holdings are unlucky in this reporting season.

Wynn Resorts (WYNN) suffered a slump on Wednesday after reporting a loss in fees in the first quarter and informing investors that it would reduce projects. Las Vegas Sands (LVS) also appeared on Wednesday, but reported a strong first quarter late that day, proving that the two companies did not have the same clothing. Las Vegas Sands shares rose Thursday.

On Thursday, MGM Resorts International shares (MGM) tumbled after the release of the first quarter earnings. The stock fell 1

0.2% to $ 31.74, a new daily low for the current year after the gaming and lodging company cut its guidance.

MGM Drops $ 201 Million in Las Vegas (Ebitda) in Las Vegas (Ebitda) Taxes, Depreciation and Amortization $ 1.75 Billion Management said three key points: 1) Mandalay Bay is recovering slowly after filming last year; 2) Monte Carlo renovation was interrupted; and 3) a major price war in the second quarter was canceled.

MGM nevertheless had a decent first quarter. Adjusted Ebitdar (Ebitda and Restructuring) was 4% down on the prior year at $ 807.7 million, but exceeded expectations of $ 710 million. Diluted earnings per share were 38 cents in the March quarter, compared to 36 cents a year ago. The EPS in the last quarter, however, includes an increase of some one off items: an income tax benefit of 13 cents; and another 4 cents came from the reversal of Macau's dividend reserve.

The power of MGM used to be in Las Vegas, but this business has once again turned out to be a stumbling block. "Difficult comparisons" and last year's tragic shoot-out weighed as expected on Las Vegas' core business, Jefferies analyst David Katz wrote in a report released today. Katz, who has a buy rating for MGM and a target price of $ 43, said, "We view the quarterly report as neutral in light of the pressure on the Las Vegas core market."


Despite the negativity around MGM At least one analyst does not consider the bad luck permanent.

"We find that the LV strip's Ebitda trim can be considered temporary (probably it will not be today), and if this Ebitda trim is capitalized with an 11x target multiplier This translates into a loss of $ 1.45 per share, "said Joseph Greff, JPMorgan analyst. Greff rates MGM overweight with a target price of $ 44 – about 36% above the closing price of $ 32.29 on Thursday.

What are the chances that MGM will serve this serve? Based on the 2018 enterprise value-to-Ebitda ratios, MGM looks cheaper than both Wynn Resorts and Las Vegas Sands, but its prospects? That could be a bitch.

Sign in to Review & Preview, a new daily e-mail from Barron's. Every night, we look at the news that has moved the markets during the day and see what it means for your portfolio in the morning.


Source link