Question of the Day - 21 October 2025

We'd say the likelihood of one of the giant casino corporations buying the other appears low, certainly in the near term. 

Rumors of a potential MGM-Caesars merger surfaced in late 2018, when MGM reportedly hired advisors to explore a bid for Caesars, potentially creating a $21 billion gaming behemoth. However, those talks fizzled out fairly quickly, with MGM opting to pursue alternatives, like adjustments in its real estate portfolio instead. No similar reports have come around since then.

From the Caesars' side, its capitalization is currrently around $5.6 billion, while MGM's is around $9.5 billion. So for Caesars to acquire MGM would require massive financing, which would certainly be challenging in the best of circumstances and these aren't those; Caesars is still carrying a high debt load from its 2020 Eldorado merger (around $10 billion net debt).

MGM, while larger, faces its own pressures, not the least of which is the continuing recovery from last year's cyberattack. In addition, the company endures a fair amount of regional competition and a Vegas slowdown. Plus, MGM just last week withdrew its application for a downstate New York gaming license and sold a racino in Ohio. As veteran gaming-industry observer Ken Adams writes, "MGM is on the move again. The plan is unclear, but it's clear that there's a new plan." All of the above, in our opinion, make MGM an improbable candidate for a Caesars buyout.

In our read of the market, both stocks have underperformed in 2025. Caesars is down roughly 37% year to date as of this writing and MGM's revenue has been flat amid softer demand for its extensive Las Vegas product. Analysts seem focused on individual growth, for example, Caesars' digital segment, and not at all on any consolidation between the two companies.

It's possible that merger-and-acquisitions activity could become more prominent than it has been of late due to falling interest rates and a potentially more lenient FTC under new leadership. Still, such a merger in the casino industry would almost certainly encounter a significant antitrust review from federal and state commissions. After all, combined, Caesars and MGM would control roughly 54,000 of Las Vegas' 150,000 rooms, more than a third of the total and well more than half of the Strip's 85,000 or so rooms. 

All that said, if economic pressures continue to mount -- the Vegas slowdown becomes prolonged -- such a merger could resurface as a defensive play. But for now, it looks to us like both companies are prioritizing standalone strategies, like digital expansion, cost cutting, and asset divesting.