MGM Intrinsic Value – MGM Resorts Takes Legal Action to Combat Problem Gambler Lawsuit
June 23, 2023
🌧️Trending News
MGM ($NYSE:MGM) Resorts International, a leading global hospitality company that owns and operates world-class entertainment resorts, has recently taken legal action in response to a lawsuit involving a problem gambler. Specifically, the lawsuit claims that MGM was negligent in providing him with free rooms and other comps to keep him gambling, despite knowing that he was having difficulty controlling his habit. The motion also denies the claim that MGM Resort’s comps amounted to unlawful inducement or promotion of gambling. MGM Resorts is hopeful that the court will agree with its motion and dismiss the case.
If successful, it would be an important victory for MGM Resorts’ ongoing efforts to protect itself from liability in cases involving problem gambling. It would also serve to strengthen the company’s reputation as a responsible operator in the gaming industry.
Share Price
On Wednesday, MGM Resorts International took legal action to combat a lawsuit from a former problem gambler. The company’s stock opened at $44.2 and then closed at $43.8, representing a decrease of 0.9% from the previous closing price of $44.2. This drop in stock price occurred amid the news that MGM was taking legal action to fight the lawsuit. The lawsuit was brought by a former problem gambler who alleged that the company had violated California law by allowing him to gamble despite being aware of his gambling addiction.
In response, MGM has reportedly filed a motion to have the case dismissed, arguing that the state of California does not have jurisdiction over the company’s gambling operations. It remains to be seen how the legal battle will play out, but its clear that MGM is doing its best to protect itself from any potential long-term damage to its reputation. Live Quote…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for MGM. More…
| Total Revenues | Net Income | Net Margin |
| 14.15k | 1.94k | -2.1% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for MGM. More…
| Operations | Investing | Financing |
| 2.04k | 2.57k | -3.24k |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for MGM. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 43.54k | 38.31k | 13.18 |
Key Ratios Snapshot
Some of the financial key ratios for MGM are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 5.7% | -24.9% | 15.2% |
| FCF Margin | ROE | ROA |
| 8.7% | 27.8% | 3.1% |
Analysis – MGM Intrinsic Value
At GoodWhale, our mission is to help investors make informed decisions. After conducting an analysis of MGM RESORTS INTERNATIONAL’s financials, we believe that the fair value of the company’s shares is around $72.8, calculated using our proprietary Valuation Line. This implies that the stock is currently trading at $43.8, which is a 39.8% discount from the fair value. With this in mind, we believe that there is an opportunity for investors to take advantage of this undervaluation. More…
Peers
MGM Resorts International is one of the world’s leading global hospitality companies, operating a portfolio of destination resort brands including Bellagio, MGM Grand, Mandalay Bay, The Mirage, and more. The company’s competitors include SkyCity Entertainment Group Ltd, Wyndham Hotels & Resorts Inc, and Cruzani Inc.
– SkyCity Entertainment Group Ltd ($NZSE:SKC)
SkyCity Entertainment Group Ltd is a casino and hospitality company based in New Zealand. The company has a market cap of 2B as of 2022 and a Return on Equity of 3.48%. SkyCity operates four casinos in New Zealand, two in Australia, and one in Chile. The company also has a number of hotels, restaurants, and bars.
– Wyndham Hotels & Resorts Inc ($NYSE:WH)
Wyndham Hotels & Resorts, Inc. is one of the largest hotel companies in the world, with over 9,000 hotels across more than 80 countries. The company offers a variety of hotel brands, including Wyndham, Ramada, Days Inn, Super 8, and Howard Johnson. Wyndham Hotels & Resorts is headquartered in Parsippany, New Jersey. The company’s market cap is 6.2B as of 2022 and its ROE is 30.65%.
Summary
MGM Resorts International is a leading global hospitality and entertainment company, with a portfolio of iconic destinations around the world. Investors should consider the company’s potential for future profits, its strong balance sheet, and its commitment to returning capital to shareholders through dividends and share repurchases. MGM Resorts International is also investing in new developments and acquisitions to expand its footprint and increase its presence in the gaming and hospitality industries. With its financial strength and growing presence, MGM Resorts International is an attractive investment opportunity for many investors.
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