Investing.com -- Jefferies downgraded MGM Resorts International to Hold from Buy, trimming its price target to $44 from $50, as analysts cited concerns about the casino operator’s capital structure and a limited near-term growth outlook.

The downgrade follows the completed sale of MGM’s Northfield Park property, which had prompted Jefferies to suspend coverage earlier. Analyst David Katz now resumed coverage with a more cautious stance, pointing to MGM’s fully leased U.S. asset portfolio as a drag.

The analyst views gaming companies operating under OpCo/PropCo structures as "structurally disincentivized to reinvest in their assets, given fixed and escalating rent obligations," thereby increasing the risk to the portfolio’s long-term earnings power.

MGM reported first-quarter 2026 revenue of $4.45 billion and adjusted EBITDAR of $1.14 billion, compared to Wall Street estimates of $4.37 billion and $1.18 billion, respectively.

Katz viewed the results as broadly neutral. A $37 million one-time increase in self-insurance expense and a $31 million decline in business interruption proceeds weighed on Las Vegas adjusted EBITDAR year-over-year, while similar items affected regional operations.

MGM China revenue came in at $1.12 billion, with an increased brand fee expected to pressure segment margins while delivering more cash to the parent.

On the growth front, Jefferies flagged softness in Las Vegas leisure demand and increasingly difficult comparisons in Macau, where competitive pressure around MGM’s core premium mass customer base is intensifying.

Japan remains the company’s next significant growth catalyst, "but with an expected timeline of approximately four years, we see limited near-term drivers," Katz wrote.

He believes the shares could rerate if MGM successfully deploys capital into opportunities targeting a mid-teens return on investment, but for now sees other land-based gaming operators as offering "more tangible and nearer-term upside opportunities."