MGM Resorts Reports On 1st May – Markets Expecting Strong Q1

As MGM Resorts International (NYSE: MGM) gears up to unveil first-quarter results on May 1st, industry analysts project a rosy picture bolstered by consumer demand growth and a robust domestic casino market.

Following a trend that saw the hospitality and gaming powerhouse surpass expectations in the previous quarter—with earnings and revenues outpacing analysts consensus by an impressive 49.72% and 5.80%, respectively—MGM stands on the precipice of possibly another upbeat earnings announcement. The forecast for the company’s earnings per share is set at 0.58 cents.

Revenues are estimated to reach approximately $4.23 billion, potentially marking an 8% upward swing from the equivalent period last year. Analysts pinpoint pent-up consumer demand, high domestic casino spending, and vigorous appetite for sports betting as the main thrust behind the anticipated revenue growth.

Significant factors contributing to MGM's domestic performance include major events such as the premiere of a Formula 1 race and the historic Super Bowl, in addition to refined marketing strategies. Such high-profile occasions are likely to draw in crowds, thereby fueling revenue streams for the company.

On the international front, MGM China is poised to present a marked improvement in its financial standing, with projected revenues earmarked at $922 million for the quarter, up significantly from $618 million a year earlier.

However, the road to financial success is not devoid of potential speedbumps. MGM does face incremental expenses tied to labour and other operational costs. Nevertheless, the company's concerted efforts to enhance productivity are anticipated to defuse any adverse impact on the bottom line. Supporting the optimistic narrative is MGM Resorts International's Earnings ESP (Expected Surprise Prediction), which stands at a promising +24.65%. MGM's encouraging outlook is not solitary within the sector.

Analysts price targets on the stock are positive, with the low mark of $46 more than 10% up from the current trading price. The high forecast on the street of $66 sets a lofty expectation, with the most recent firm to initiate coverage also coming in positive. Seaport Research initiated coverage with a price target of $56 and a ‘buy' rating. Analyst Vitaly Umansky indicated in a research note that the firm sees the US casino industry encountering headwinds, whilst expecting Macau (where MGM has 6 operators) to deliver strong results both in 2024 and 2025.

As the bell tolls on May 1st, market watchers and investors alike will be keenly tuned in to see if MGM Resorts can indeed deliver on what the numbers seem to promise—further establishing itself as a resilient frontrunner in the consumer discretionary space.