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MGM Resorts (MGM) Beats Q1 Earnings, Lags Revenues

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.

Macau is a key operating region for MGM Resorts. However, gambling revenues in Macau have been soft over the past few quarters due to anti-graft corruption drive undertaken by the Chinese government. China's crackdown on illegal money transfers, credit growth issues, and tighter restrictions on visas have had a massive negative impact on revenues in this region. The weakening of yuan has also dented Macau’s gambling revenues as it gets more expensive for Chinese gamblers to place bets. Further, slowdown in the Chinese economy continues to hurt the mass market segment.

Investors should note the recent earnings estimate revisions for MGM has been quite stable. Meanwhile, MGM has a decent history in earnings season. MGM Resorts has delivered positive earnings surprises in three of the last four quarters, making for a substantial average positive surprise of 106.49%. Meanwhile, the company has missed revenue results in three of the trailing four quarters.

Currently, MGM has a Zacks Rank #3 (Hold) but that could change following MGM Resorts’ earnings report which was just released. We have highlighted some of the key stats from this just-revealed announcement below:

Earnings: MGM beats on adjusted earnings. Our consensus earnings estimate called for earnings per share of 13 cents, and the company reported 16 cents.

Revenues: MGM reported revenues of $2.21 billion. This missed our consensus estimate of 2.31 billion.

Key Stats to Note: Net revenue at the company's wholly owned domestic resorts increased 3% year over year while MGM China’s net revenue declined 26% year over year.

Stock Price: In-active in pre-market trading.

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

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