MGM Stock Intrinsic Value – Entain Could Sell BetMGM Stake to MGM Resorts International
December 20, 2023
🌥️Trending News
MGM ($NYSE:MGM) Resorts International is a leading global hospitality and entertainment company that owns and operates some of the most iconic destination resorts in the world. Recently, it has been suggested that MGM Resorts could purchase the stake that Entain holds in the sports betting platform BetMGM. This potential purchase could give MGM Resorts access to a rapidly growing area of their industry. Entain, formerly known as GVC Holdings, is a multinational sports betting and gaming group. BetMGM is one of Entain’s most successful operations, and MGM Resorts now have the potential to take control of it by purchasing Entain’s stake. This move makes sense for MGM Resorts, as they already have a strong presence in the gambling market.
They have a wide range of brick-and-mortar casinos, hotels, and entertainment venues across the United States. By taking control of BetMGM, they can increase their presence in the sports betting industry and expand their offerings to their customers. It is likely that such a move would result in considerable growth for MGM Resorts, as they could benefit from the increased exposure and customer base that BetMGM provides. This potential purchase could be an important step for both MGM Resorts and Entain, and it will be interesting to see how it develops in the near future. If successful, it could have a positive impact on both companies and be a great opportunity to increase their presence in the competitive online gambling market.
Stock Price
On Tuesday, shares of MGM Resorts International (MGM) opened at $43.8 and closed at $45.0, up 3.4%. It was reported that Entain, a technology-led gaming entertainment provider, could be selling its stake in BetMGM to MGM Resorts International. BetMGM is a joint venture between Entain and MGM Resorts International that provides online gaming services and entertainment. The potential sale would provide MGM Resorts International an opportunity to increase its stake in the venture and gain full control of the business.
The potential deal could be beneficial for both parties as Entain could benefit from the cash infusion while MGM Resorts International could gain from increased ownership in the venture. The details of the deal, however, have not been disclosed yet. 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 |
| 15.38k | 1.1k | -0.2% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for MGM. More…
| Operations | Investing | Financing |
| 2.4k | 114.99 | -4.42k |
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 |
| 42.57k | 38.11k | 11.63 |
Key Ratios Snapshot
Some of the financial key ratios for MGM are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 30.9% | -51.5% | 10.5% |
| FCF Margin | ROE | ROA |
| 9.7% | 24.0% | 2.4% |
Analysis – MGM Stock Intrinsic Value
At GoodWhale, we recently performed an analysis of MGM RESORTS INTERNATIONAL’s fundamentals. Our proprietary Valuation Line assessment showed that the intrinsic value of MGM RESORTS INTERNATIONAL share is around $76.8. However, the stock is currently trading at $45.0, which is a 41.4% discount to the estimated intrinsic value. This suggests a potential buying opportunity for investors. More…
Peers
MGM Resorts International is one of the world’s leading global hospitality companies, operating a portfolio of destination resort brands including Bellagio, MGM Grand, Mandalay Bay, The Mirage, and more. The company’s competitors include SkyCity Entertainment Group Ltd, Wyndham Hotels & Resorts Inc, and Cruzani Inc.
– SkyCity Entertainment Group Ltd ($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 (MGM) is a popular stock for investors due to its large market cap and diverse portfolio of properties and investments. The company recently announced its potential purchase of Entain’s stake in the BetMGM online gaming joint venture, which sent the stock price up the same day. Analysts expect this move to further diversify the company’s revenue streams, as well as increase profits as online gaming continues to grow in popularity.
Investors should take note of this development, as well as MGM’s strong financials and presence across multiple industries. MGM’s stock remains a great long-term option due to its potential for growth and value appreciation.
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