MGM Resorts International (NYSE:MGM) Shares Gap Down Following Analyst Downgrade

Key Points

• MGM Resorts shares fell sharply after Susquehanna cut its price target from $55 to $46, opening at $33.87 versus the prior close of $37.85, though it maintained a positive rating.
• Analyst sentiment remains broadly favorable: MGM has a “Moderate Buy” consensus rating and an average price target of $52.24, despite ratings ranging from Strong Buy to Sell.
• MGM recently exceeded quarterly earnings and revenue expectations, reporting $0.59 in EPS and $4.45 billion in revenue, while institutional investors own approximately 68.1% of the company.

MGM Resorts International (NYSE:MGM - Get Free Report) gapped down prior to trading on Thursday after Susquehanna lowered their price target on the stock from $55.00 to $46.00. The stock had previously closed at $37.85, but opened at $33.87. Susquehanna currently has a positive rating on the stock. MGM Resorts International shares last traded at $34.1850, with a volume of 3,302,668 shares changing hands.

Several other analysts also recently commented on the company. The Goldman Sachs Group restated a "sell" rating and issued a $43.00 target price on shares of MGM Resorts International in a research note on Wednesday, July 15th. HSBC raised shares of MGM Resorts International to a "strong-buy" rating in a report on Thursday, July 30th. Weiss Ratings raised MGM Resorts International from a "sell (d+)" rating to a "hold (c)" rating in a report on Thursday, July 30th. JPMorgan Chase & Co. boosted their price objective on MGM Resorts International from $46.00 to $53.00 and gave the company an "overweight" rating in a research report on Friday, June 12th. Finally, Stifel Nicolaus restated a "hold" rating and issued a $49.00 target price (up from $48.00) on shares of MGM Resorts International in a report on Monday, June 15th. Two analysts have rated the stock with a Strong Buy rating, ten have issued a Buy rating, nine have assigned a Hold rating and two have issued a Sell rating to the company. Based on data from MarketBeat, MGM Resorts International presently has an average rating of "Moderate Buy" and a consensus target price of $52.24.

Trending Headlines about MGM Resorts International

Here are the key news stories impacting MGM Resorts International this week:

• Positive Sentiment: Capital One raised its price target on MGM from $53 to $57 and maintained an “overweight” rating, implying substantial upside from the current trading level.
• Positive Sentiment: Susquehanna lowered its target from $55 to $46 but retained a positive rating, indicating that analysts still see meaningful upside despite the failed deal.
• Neutral Sentiment: MGM’s board confirmed its commitment to executing the company’s strategy as a standalone business after People Inc. withdrew its proposal. MGM Resorts board confirms standalone strategy
• Negative Sentiment: The failed takeover eliminates the immediate possibility of a deal near the reported $48.30-per-share proposal, likely weighing on investor expectations and the stock’s valuation. Barry Diller withdraws MGM bid
• Negative Sentiment: A securities law firm announced an investigation related to Diller’s proposal, adding a potential legal and governance overhang. The announcement is an investigation notice, not a finding of wrongdoing. MGM investor investigation announcement

Hedge Funds Weigh In On MGM Resorts International

A number of institutional investors have recently added to or reduced their stakes in the company. QRG Capital Management Inc. lifted its position in MGM Resorts International by 10.9% during the second quarter. QRG Capital Management Inc. now owns 37,863 shares of the company's stock valued at $1,810,000 after buying an additional 3,716 shares during the period. Envestnet Asset Management Inc. boosted its stake in MGM Resorts International by 1.1% during the second quarter. Envestnet Asset Management Inc. now owns 494,992 shares of the company's stock worth $23,666,000 after acquiring an additional 5,411 shares in the last quarter. State Street Corp grew its holdings in MGM Resorts International by 0.8% in the second quarter. State Street Corp now owns 7,047,768 shares of the company's stock worth $336,954,000 after purchasing an additional 56,072 shares during the period. The Manufacturers Life Insurance Company grew its holdings in MGM Resorts International by 6.1% in the second quarter. The Manufacturers Life Insurance Company now owns 152,329 shares of the company's stock worth $7,283,000 after purchasing an additional 8,721 shares during the period. Finally, Sequoia Financial Advisors LLC increased its stake in shares of MGM Resorts International by 3.1% during the second quarter. Sequoia Financial Advisors LLC now owns 36,005 shares of the company's stock valued at $1,721,000 after purchasing an additional 1,075 shares in the last quarter. Institutional investors own 68.11% of the company's stock.

MGM Resorts International Stock Down 9.8%

The company's fifty day moving average price is $42.88 and its 200-day moving average price is $41.81. The stock has a market capitalization of $8.59 billion, a PE ratio of 20.67, a price-to-earnings-growth ratio of 1.99 and a beta of 1.28. The company has a quick ratio of 1.30, a current ratio of 1.34 and a debt-to-equity ratio of 1.80.

MGM Resorts International (NYSE:MGM - Get Free Report) last posted its quarterly earnings results on Wednesday, July 29th. The company reported $0.59 earnings per share for the quarter, topping the consensus estimate of $0.56 by $0.03. MGM Resorts International had a return on equity of 23.30% and a net margin of 2.40%.The company had revenue of $4.45 billion for the quarter, compared to the consensus estimate of $4.42 billion. During the same quarter in the prior year, the business posted $0.79 EPS. The firm's quarterly revenue was up 2.2% compared to the same quarter last year. Analysts forecast that MGM Resorts International will post 1.96 earnings per share for the current year.

About MGM Resorts International

MGM Resorts International is a global hospitality and entertainment company that owns and operates destination resorts, casinos, hotels, restaurants, convention facilities and live-entertainment venues. Its properties offer casino gaming, hotel accommodations, dining, nightlife, retail, spa services, sporting events and other leisure activities.

The company operates a portfolio of resorts in Las Vegas and other U.S. markets, including properties associated with brands such as MGM Grand, Bellagio, ARIA, Mandalay Bay, Park MGM, New York-New York and MGM National Harbor.

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