MGM Resorts International (MGM) Cut to “Sell” at Zacks Investment Research
MGM Resorts International (NYSE:MGM) was downgraded by Zacks Investment Research from a “hold” rating to a “sell” rating in a research report issued on Wednesday.
According to Zacks, “MGM Resorts’ shares underperformed the Zacks classified Gaming industry year to date. A tough operating environment in Macau weighed on MGM Resorts’ revenues since Jun 2014 to the most part of 2016. Though revival of gaming revenues in Macau is a huge positive, it will take time for the region to return to its former glory as concerns related to sustainability of revenues from the VIP market linger. In fact, in Q1 2017, though revenues at MGM China increased 7%, VIP table games revenues declined 5% as turnover plunged 16%. Meanwhile, the company’s strong portfolio and focus on non-gaming activities could offset the impact of these headwinds to some extent. Moreover, the Las Vegas business is doing well on the back of the ongoing economic recovery and growing tourism in the region, which should drive incremental revenues at properties there. However, heightened competition and increased debt pressure are causes of concern.”
MGM has been the topic of a number of other reports. Telsey Advisory Group restated an “outperform” rating and set a $36.00 price target (up from $32.00) on shares of MGM Resorts International in a research report on Thursday, April 27th. Goldman Sachs Group, Inc. (The) restated a “buy” rating and set a $36.00 price target on shares of MGM Resorts International in a research report on Tuesday, April 4th. TheStreet upgraded shares of MGM Resorts International from a “c+” rating to a “b” rating in a research report on Friday, April 28th. Deutsche Bank AG restated a “buy” rating on shares of MGM Resorts International in a research report on Monday, March 6th. Finally, Barclays PLC dropped their price target on shares of MGM Resorts International from $32.00 to $31.00 and set an “overweight” rating on the stock in a research report on Thursday, March 23rd. One research analyst has rated the stock with a sell rating, one has assigned a hold rating and eighteen have assigned a buy rating to the company. The company currently has a consensus rating of “Buy” and a consensus price target of $34.20.
Shares of MGM Resorts International (NYSE:MGM) traded down 0.09% during midday trading on Wednesday, hitting $33.70. 7,730,680 shares of the stock were exchanged. The company has a market cap of $19.37 billion, a PE ratio of 15.66 and a beta of 1.44. The firm has a 50-day moving average price of $31.75 and a 200-day moving average price of $29.08. MGM Resorts International has a 12-month low of $21.31 and a 12-month high of $34.00.
MGM Resorts International (NYSE:MGM) last issued its quarterly earnings data on Thursday, April 27th. The company reported $0.38 earnings per share for the quarter, beating the Thomson Reuters’ consensus estimate of $0.26 by $0.12. MGM Resorts International had a net margin of 12.25% and a return on equity of 7.76%. The firm had revenue of $2.71 billion for the quarter, compared to the consensus estimate of $2.63 billion. During the same period last year, the firm posted $0.16 EPS. MGM Resorts International’s quarterly revenue was up 22.6% compared to the same quarter last year. On average, equities analysts predict that MGM Resorts International will post $1.28 EPS for the current year.
The business also recently disclosed a quarterly dividend, which was paid on Thursday, June 15th. Investors of record on Friday, June 9th were given a dividend of $0.11 per share. This represents a $0.44 dividend on an annualized basis and a yield of 1.31%. The ex-dividend date was Wednesday, June 7th. MGM Resorts International’s payout ratio is presently 20.37%.
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In related news, COO Corey Ian Sanders sold 21,441 shares of the business’s stock in a transaction that occurred on Monday, May 15th. The shares were sold at an average price of $31.60, for a total transaction of $677,535.60. Following the transaction, the chief operating officer now directly owns 210,558 shares of the company’s stock, valued at $6,653,632.80. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is accessible through the SEC website. Also, EVP Robert Selwood sold 10,046 shares of the business’s stock in a transaction that occurred on Thursday, May 25th. The shares were sold at an average price of $31.56, for a total transaction of $317,051.76. Following the transaction, the executive vice president now directly owns 116,743 shares in the company, valued at $3,684,409.08. The disclosure for this sale can be found here. Insiders have sold 83,070 shares of company stock worth $2,591,372 over the last ninety days. 12.20% of the stock is currently owned by insiders.
Hedge funds and other institutional investors have recently made changes to their positions in the stock. Comerica Bank bought a new position in shares of MGM Resorts International during the fourth quarter worth approximately $770,000. Federated Investors Inc. PA increased its position in shares of MGM Resorts International by 689.0% in the fourth quarter. Federated Investors Inc. PA now owns 70,549 shares of the company’s stock worth $2,034,000 after buying an additional 61,607 shares during the last quarter. FMR LLC increased its position in shares of MGM Resorts International by 40.8% in the fourth quarter. FMR LLC now owns 3,222,400 shares of the company’s stock worth $92,902,000 after buying an additional 933,800 shares during the last quarter. Pacad Investment Ltd. bought a new position in shares of MGM Resorts International during the fourth quarter worth approximately $199,000. Finally, Envestnet Asset Management Inc. increased its position in shares of MGM Resorts International by 6.4% in the fourth quarter. Envestnet Asset Management Inc. now owns 32,261 shares of the company’s stock worth $930,000 after buying an additional 1,951 shares during the last quarter. 73.62% of the stock is currently owned by hedge funds and other institutional investors.
MGM Resorts International Company Profile
MGM Resorts International is a holding company. The Company, through its subsidiaries, owns and operates casino resorts. The Company operates in two segments: domestic resorts and MGM China. Its domestic resorts segment consists of non-gaming operations, including hotel, food and beverage, entertainment and other non-gaming amenities.
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