MGM Resorts (MGM) Borgata Should Be Worth $1/Share - Nomura

Nomura Securities analyst Harry Curtis reiterated a Buy rating and $31 price target on MGM Resorts (NYSE: MGM) saying Borgata should be worth $1 per share.

Curtis comments, "After yesterday’s close, MGM released a statement on the company’s requalification in New Jersey. MGM expects to receive $86mn of cash from the divestiture trust that currently holds MGM’s interest in the next 30 days, once the New Jersey Division of Gaming Enforcement finalizes the approval. Although the accounting of the JV has not been finalized between MGM and BYD, the biggest hurdle in ascribing value to Borgata is now surpassed. We expect MGM’s 2015 EBITDA to include 50% of Borgata’s operating income, which is estimated to be $91mn. Using an average share count of 563mn. This accounting method is consistent with the City Center JV’s accounting method, which includes 50% of the JV’s operating income in MGM’s consolidated EBITDA."

For an analyst ratings summary and ratings history on MGM Resorts click here. For more ratings news on MGM Resorts click here.

Shares of MGM Resorts closed at $24.18 yesterday.

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