November 21, 2024
Top 10 Stock MGM Resorts Buy Recommendation
How to read the ranks
For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".
Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".
Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.
Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.
(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).
(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.
Snapshot: MGM Resorts – Top 10 Stock in Diversity Leaders in United States
MGM Resorts is listed as a top 10 stock on November 21, 2024 in the market index Diversity USA because of its high performance in at least one of the Obermatt investment strategies. While half the consolidated Obermatt Ranks are above-average, investor sentiment is negative and growth performance is below market average, both a sign for caution. Based on the Obermatt 360° View of 54 (high 54% performer), Obermatt assesses an overall buy recommendation for MGM Resorts on November 21, 2024.
Snapshot: Obermatt Ranks
| Country | USA |
| Industry | Casinos & Gaming |
| Index | Energy Efficient, Diversity USA, S&P US Luxury, S&P 500 |
| Size class | XX-Large |
When Obermatt identifies the Top 10 stocks in a market, it’s based on a certain investment strategy. The best performing stocks usually aren’t the ones that everyone is talking about (those are often "over-priced" and have low Value ranks).
For each investment strategy, we provide you with more detailed analysis and our recommendation. You see the ranks of the top 10 stocks ranked by that particular investment strategy (360° View, Sentiment, Value, Growth, Safety and Combined Financial Performance).
360° View: Obermatt 360° View MGM Resorts Buy
| 360 METRICS | November 21, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 51 |
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| GROWTH | ||||||||
| GROWTH | 15 |
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| SAFETY | ||||||||
| SAFETY | 96 |
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| SENTIMENT | ||||||||
| SENTIMENT | 36 |
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| 360° VIEW | ||||||||
| 360° VIEW | 54 |
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ANALYSIS: With an Obermatt 360° View of 54 (better than 54% compared with alternatives), overall professional sentiment and financial characteristics for the stock MGM Resorts are above average. The 360° View is based on consolidating four consolidated indicators, with half the metrics below and half above average for MGM Resorts. The consolidated Value Rank has an attractive rank of 51, which means that the share price of MGM Resorts is on the lower side compared with the typical size in indicators such as revenues, profits, and invested capital. This means the stock price is lower than for 51% of alternative stocks in the same industry. The company is also safely financed with a Safety rank of 96. But the professional market sentiment is below average compared with other stock investment alternatives with a Sentiment Rank of 36. Professional investors are more confident in 64% other stocks. The consolidated Growth Rank also has a low rank of 15, which means that the company is below average in terms of growth momentum when looking at financial metrics such as revenue, profit, invested capital growth, and stock returns. 85 of its competitors have better growth. ...read more
RECOMMENDATION: With a consolidated 360° View of 54, MGM Resorts is better positioned than 54% of all alternative stock investment opportunities based on the Obermatt Method. The picture is mixed here. The stock seems to be a good value (Value Rank of 51), and the financing structure is on the safer side (Safety Rank of 96). However, sentiment in the professional investor community is below-average (Sentiment Rank of 36), as is the growth momentum for the company (Growth Rank of 15). Since the company is good value and the share price low, it should attract investors, yet professionals are skeptical. Even though the financing structure is not as important as Value, Growth, and Sentiment, investors should still be careful with this decision and conduct further research if they are serious about investing in this company. ...read more
Sentiment Strategy: Professional Market Sentiment for MGM Resorts only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 36 (better than 36% compared with alternatives), overall professional sentiment and engagement for the stock MGM Resorts is below industry average. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the indicators below and half above average for MGM Resorts. Analyst Opinions are at a rank of 64 (better than 64% of alternative investments), which means that currently, stock research analysts tend to recommend a stock investment in the company. Market Pulse is also positive with a rank of 56, which means that the current professional news and professional social networks are positive when discussing this company (more positive news than for 56% of competitors). But Analyst Opinions Change is negative with a below 50 rank of 25, which means that stock research experts are changing their opinions for the worse in recommending the company. In other words, they are getting more critical of investments in MGM Resorts. There are also only so many institutional investors holding company stock with a Professional Investors rank of 22, which means that, currently, professional investors hold less stock in this company than in 78% of alternative investment opportunities. Pros tend to invest in other companies. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 36 (less encouraging than 64% compared with investment alternatives), MGM Resorts has a reputation among professional investors that is below that of its competitors. The signals are ambivalent. The positive news in the market contradicts the negative change in analyst recommendations. Since the overall analyst recommendations are still above average, the stock may be safer for investing, especially if it is not an extra-large company where Pros tend to be less present. In such a case, the Pro Investor rank is not a problem. ...read more
Value Strategy: MGM Resorts Stock Price Value better than average
ANALYSIS: With an Obermatt Value Rank of 51 (better than 51% compared with alternatives), MGM Resorts shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators, where half the indicators are below and half are above average for MGM Resorts. Price-to-Sales (P/S) is 75, which means that the stock price compared with what market professionals expect for future sales is lower than for 75% of comparable companies, indicating a good value concerning MGM Resorts's revenue size. The same is valid for expected Price-to-Profits (or Price / Earnings, P/E), more favorable than for 57% of alternatives. It is also positive for expected dividend yields with a Dividend Yield rank of 1 (dividends are expected to be higher than for 1% of other stocks). But, compared with other companies in the same industry, the Price-to-Book Capital ratio (also referred to as market-to-book ratio) is higher than average, making the stock more expensive. Only 53% of all competitors have an even higher price compared with book capital which puts the Price-to-Capital Rank for MGM Resorts to 47. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 51, is a buy recommendation based on MGM Resorts's stock price compared with the company's operational size and dividend yields. A low level of book capital means that the company has a business that is leaner on assets than its competitors. For instance, the company could be leasing its production facilities, or be more focussed on intellectual property, such as its brand and software, which is less visible in its book capital. If that is the case, the low Dividend Yield is also explained as such companies tend to invest their income into market development. The other good value ranks for Sales and Profits are encouraging indicators for the stock price value. ...read more
Growth Strategy: MGM Resorts Growth Momentum negative
| GROWTH METRICS | November 21, 2024 | |||||||
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| REVENUE GROWTH | ||||||||
| REVENUE GROWTH | 10 |
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| PROFIT GROWTH | ||||||||
| PROFIT GROWTH | 32 |
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| CAPITAL GROWTH | ||||||||
| CAPITAL GROWTH | 59 |
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| STOCK RETURNS | ||||||||
| STOCK RETURNS | 35 |
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| CONSOLIDATED RANK: GROWTH | ||||||||
| CONSOLIDATED RANK: GROWTH | 15 |
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ANALYSIS: With an Obermatt Growth Rank of 15 (better than 15% compared with alternatives), MGM Resorts shows one of the most restricted growth dynamics in its industry. There is little momentum in this company. The Growth Rank is based on consolidating four value indicators, with three out of four indicators below average for MGM Resorts. Only Capital Growth has a good rank of 59, which means that currently professionals expect the company to grow its invested capital more than 32% of its competitors. The other three indicators are pointing South: Sales Growth has a rank of 10 which means that currently professionals expect the company to grow less than 90% of its competitors. Profit Growth with a rank of 32 and Stock Returns with a rank of 35 are also low (below 65% of alternative investments). ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 15, is a sell recommendation for growth and momentum investors. The good news from the invested capital side is surprising. A company with disappointing revenues, profits, and disappointed shareholders typically doesn't invest above average. Overall, the growth momentum for MGM Resorts is thus negative. As it is intriguing to see that company executives are optimistic about their investment policy, it is worthwhile looking into the details of the capital investment projects. They may indicate future growth and profits and thus if accompanied by a good value, a sign of good timing to invest in the stock. ...read more
Safety Strategy: MGM Resorts Debt Financing Safety very solid
| SAFETY METRICS | November 21, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 70 |
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| REFINANCING | ||||||||
| REFINANCING | 90 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 66 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 96 |
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ANALYSIS: With an Obermatt Safety Rank of 96 (better than 96% compared with alternatives) for 2024, the company MGM Resorts has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of MGM Resorts is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, where all three are above average for MGM Resorts. Leverage is at 70, meaning the company has a below-average debt-to-equity ratio. It has less debt than 70% of its competitors. Refinancing is at a rank of 90, meaning that the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 90% of its competitors. Finally, Liquidity is also good at a rank of 66, which means that the company generates more profit to service its debt than 66% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 96 (better than 96% compared with alternatives), MGM Resorts has a financing structure that is significantly safer than that of its competitors. These three positive financing indicators signal that the company is less likely to default on its debt obligations. However, it also means that its shareholder returns will be more modest if things go well. A low safety means fewer troubles in downtimes and less upside in good times. ...read more
Combined financial peformance: MGM Resorts Above-Average Financial Performance
| COMBINED PERFORMANCE | November 21, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 51 |
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| GROWTH | ||||||||
| GROWTH | 15 |
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| SAFETY | ||||||||
| SAFETY | 66 |
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| COMBINED | ||||||||
| COMBINED | 68 |
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ANALYSIS: With an Obermatt Combined Rank of 68 (better than 68% compared with investment alternatives), MGM Resorts (Casinos & Gaming, USA) shares have above-average financial characteristics compared with similar stocks. Shares of MGM Resorts are a good value (attractively priced) with a consolidated Value Rank of 51 (better than 51% of alternatives), are safely financed (Safety Rank of 96, which means low debt burdens), but show below-average growth (Growth Rank of 15). ...read more
RECOMMENDATION: A Combined Rank of 68, is a buy recommendation based on MGM Resorts's financial characteristics. As the company MGM Resorts's key financial metrics exhibit good value (Obermatt Value Rank of 51) but low growth (Obermatt Growth Rank of 15) while being safely financed (Obermatt Safety Rank of 96), it may be a safer investment because companies with low debt can better withstand times of crises. Yet the good value, better than 51% of comparable companies, may also indicate that the company's future is challenging. If you believe that low growth is temporary or just due to a specific current event, you may conclude that the good value of the stock provides an attractive investment opportunity and the downside is limited due to below-average financing risks. ...read more
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