Macquarie's Thoughts On MGM's First Investor Day

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Despite no change in price target or rating, Macquarie released a note listing reasons why they're incrementally more positive on MGM Resorts International MGM moving forward. Attending MGM's first ever investor day on June 16, they highlighted reasons why the casino's outlook is much more positive beyond 2016.

  • Profit growth plan grows from $300 to $400 million as management sees EBITDA margins passing 30 percent.
  • Macquarie believes MGM has best corporate culture in Las Vegas.
  • MGM doesn't see a slowdown, which will eventually give the casino an opportunity to up prices and grow revPAR for several years.
  • Macquarie expects returns to be over 15 percent with National Harbor project exceeding expectations.
  • Management made clear Macau is a healthy market, and the company has done a decent job holding market share.
  • MGP has already acquired $100 million of rent through Borgata transaction.

Shares of MGM Resorts ended Monday down 1.34 percent at $24.28.

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Posted In: Analyst ColorReiterationAnalyst RatingsMacquarie
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