KeyBanc Upgrades MGM Resorts (MGM) to Hold as the Lights Shine in Vegas and Macau
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Price: $43.64 +1.09%
Rating Summary:
23 Buy, 15 Hold, 4 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
Rating Summary:
23 Buy, 15 Hold, 4 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
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KeyBanc upgraded shares of MGM Resorts (NYSE: MGM) to a Hold rating from its previous rating of Underperform.
The firm reports that shares have underperformed this year as they are down 1.8 percent when the S&P 500 is up 4.9 percent and the Dow is up 8 percent.
Recent reports show signs of an uptick in the Las Vegas Strip which is promising for the company. The firm notes that when you combine that with the growth in Macau, shares should trade inline with the market. KeyBanc has not derived a new price target yet, but does believe shares should trade well above its old $9 price target.
For the next two years KeyBanc is forecasting that MGM will post negative earnings of $0.56 for 2011 and $0.30 for 2012, these estimates are raised from a loss of $0.68 and a loss of $0.40. The firm is also raising its 2011 EPS estimates for Q2, Q3, and Q4 to a loss of $0.11, loss of $0.13, and a loss of $0.16 from a loss of $0.17, loss of $0.16, and a loss of $0.20.
KeyBanc comments that one of its major concerns is the company's abundance of debt, the longer-term trends in Las Vegas, possible difficult comparisons in Macau, and the long-term uncertainty about the Chinese regulatory environment. The firm notes that these trends are halting them from raising their valuation rating higher than Hold.
For more ratings news on MGM Resorts click here and for the rating history of MGM Resorts click here.
Shares of MGM Resorts closed at $14.49 yesterday.
The firm reports that shares have underperformed this year as they are down 1.8 percent when the S&P 500 is up 4.9 percent and the Dow is up 8 percent.
Recent reports show signs of an uptick in the Las Vegas Strip which is promising for the company. The firm notes that when you combine that with the growth in Macau, shares should trade inline with the market. KeyBanc has not derived a new price target yet, but does believe shares should trade well above its old $9 price target.
For the next two years KeyBanc is forecasting that MGM will post negative earnings of $0.56 for 2011 and $0.30 for 2012, these estimates are raised from a loss of $0.68 and a loss of $0.40. The firm is also raising its 2011 EPS estimates for Q2, Q3, and Q4 to a loss of $0.11, loss of $0.13, and a loss of $0.16 from a loss of $0.17, loss of $0.16, and a loss of $0.20.
KeyBanc comments that one of its major concerns is the company's abundance of debt, the longer-term trends in Las Vegas, possible difficult comparisons in Macau, and the long-term uncertainty about the Chinese regulatory environment. The firm notes that these trends are halting them from raising their valuation rating higher than Hold.
For more ratings news on MGM Resorts click here and for the rating history of MGM Resorts click here.
Shares of MGM Resorts closed at $14.49 yesterday.
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