MGM stock (NYSE:MGM) jumped on Friday after Stifel signaled its belief that strength in Las Vegas and Macau is set to continue over the longer term.
“At this point, we believe the LV Strip momentum should easily continue through 2023 and into 2024, and we see more value with Macau/LV Strip operators versus pure play regional gaming operators,” equity analyst Steven M. Wieczynski told clients on Friday. “LV Strip leisure demand remains solid, and we have seen no evidence that customer spending is softening.”
He added that a return of group travel and convention business to the town after a long pandemic-driven lull should boost operators like MGM through 2023. This base is strengthened by the fact that Macau is expected to bounce back once restrictions are lifted, that new licenses could be issued in places like New York, and that iGaming is still going strong.
“We have always said the likely winners in this “arms race” will be the operators with the strongest databases and loyalty programs.” “We believe MGM fits that profile, very similar to Caesars Entertainment (CZR), and don’t believe their current share price or valuation are giving the company much credit for that potential long-term growth opportunity,” Wieczynski concluded. “We have raised our out-year estimates as our previous estimates were probably too conservative and unrealistic, even in a tough economic environment.”
MGM Stock Up
He raised his price target to $46 from a prior $42, along with the upgrade to Buy from Hold. Shares of MGM Resorts International (NYSE:MGM) moved 4.95% higher near the midpoint of Friday’s trading.
Most deals on the Las Vegas Strip are big ones, with the land purchase being the first step toward building a big casino, resort, or attraction. Tilman Fertitta, the owner of the Houston Rockets, has largely followed that path.
The billionaire purchased land on the Las Vegas Strip between Caesars Entertainment and Fremont Street-owned Golden Nugget. Request a Free Report Planet Hollywood and MGM Resorts International’s (MGM) Request a Free Report April at the MGM Grand. The announcement of his plans for the property in October and that purchase both made headlines.
Why Did MGM Resorts Stock Rise On Wednesday?
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