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Will MGM Resorts (MGM) Surpass Estimates This Earnings Season?

Zacks Equity Research
·3 min read

MGM Resorts International MGM is scheduled to report second-quarter 2021 results on Aug 4, after market close. In the last reported quarter, the company’s earnings beat the Zacks Consensus Estimate by 20.9%.

Trend in Estimate Revision

For the quarter to be reported, the Zacks Consensus Estimate for loss per share has narrowed down from 45 cents to 33 cents in the past 30 days. The estimate indicates an improvement of 78.3% from a loss of $1.52 per share reported in the year-ago quarter. The consensus mark for revenues is pegged at $2.16 billion, suggesting 646% growth from the year-ago quarter’s reported figure of $289.8 million.

Factors to Consider

The company’s earnings and revenues for second-quarter 2021 are expected to improve on a year-over-year basis owing to improving consumer demand for its domestic properties. Changes made by MGM resorts in its operating model are likely to have driven growth in the quarter to be reported. Also, sequential improvement in Las Vegas results and high demand for leisure are major factors that might have boosted the company’s growth in second-quarter 2021. The Zacks Consensus Estimate for Las Vegas Strip and Regional operations’ revenues are pegged at $794 million and $780 million, suggesting year-over-year surge of 425.8% and 776.4%, respectively.

Moreover, the company’s quarterly performance is likely to have benefited from strong digitalization efforts along with robust demand for sports betting. The company is consistently focused on sports-betting expansion. During the first quarter of 2021, BetMGM reported solid results on the back of market share gains in existing markets along with new entries such as Iowa, Michigan and Virginia. Meanwhile, the company is optimistic with respect to BetMGM operations as it expects strong revenue contributions for second-quarter 2021 and beyond.

The company’s top line in the quarter is likely to have been aided by robust performance of MGM China owing to steady recovery in the Macau market. The Zacks Consensus Estimate for revenues for MGM China is pegged at $336 million, indicating an improvement of 918% year over year.

The company may continue to witness the outperformance of MGM China during second-quarter 2021.

However, temporary closure of certain properties for a portion of quarter, lower business volume as well as travel and operational restrictions due to the pandemic are likely to have impacted the company’s second-quarter peformance.

MGM Resorts International Price and EPS Surprise

MGM Resorts International Price and EPS Surprise
MGM Resorts International Price and EPS Surprise

MGM Resorts International price-eps-surprise | MGM Resorts International Quote

What Our Model Indicates

Our proven model predicts an earnings beat for MGM Resorts this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat.

Earnings ESP: Earnings ESP for MGM Resorts is +51.54%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: The company currently has a Zacks Rank #3.

You can see the complete list of today’s Zacks #1 Rank stocks here.

Other Stocks With Favorable Combination

Here are some other companies in the Zacks Consumer Discretionary sector, which according to our model, also have the right combination of elements to post an earnings beat in their respective quarters to be reported.

Penn National Gaming, Inc. PENN has an Earnings ESP of + 26.32% and a Zacks Rank #1.

Hyatt Hotels Corporation H has an Earnings ESP of +12.24% and a Zacks Rank #3.

Accel Entertainment, Inc. ACEL has an Earnings ESP of +4.55% and a Zacks Rank #3.









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Hyatt Hotels Corporation (H) : Free Stock Analysis Report

MGM Resorts International (MGM) : Free Stock Analysis Report

Penn National Gaming, Inc. (PENN) : Free Stock Analysis Report

Accel Entertainment, Inc. (ACEL) : Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research