Although they remain relatively pessimistic on Macao, analysts at JP Morgan like MGM Resorts International sufficiently to raise their price target on its stock to $24/share. The primary reason was “better than expected trends” at MGM’s regional U.S. casinos, followed by a higher cash-flow estimate for the Las Vegas Strip. Finally, MGM’s online-gaming prospects looked good enough to goose the stock to two-dozen dollars. “We could conceivably become more positive on MGM as an investment at lower levels, but look at current valuation as giving fair value to its regional portfolio, a multi-year LV Strip recovery (we think commences in 2H21/4Q21), value for [MGM Growth Properties] and Macau, as well as its longer-term sports betting/iGaming opportunity,” wrote Joseph Greff. Note that Greff says MGM is just going to have to hang in there on the Strip for another full year. Then things get better.
I think you need to re-read that article David, it cites a $10 on average drop in the room rates from a year ago, not $10 rooms… And Las Vegas Metro blaming a ten dollar drop in room rates for violent crime is disingenuous, it suggests that criminals walking around with guns committing crimes are driven by lunch money savings. Las Vegas opened up, that would seem to be the driving factor if you ask me, the gangs got bored roaming around areas that are closed.
I should have been clearer. Companies like Caesars Entertainment have been offering rooms for as little as $10/night (plus resort fees). Hence the reference. My apologies to the readership. As S&G mentioned yesterday, the average daily rate for 11/1-7 is $99/night.
Its notable as well that the violent crime is in the Strip area, the Fremont Street cluster of resorts does not seem to be suffering from a spike. The Strip is a vast area, much harder to police, especially if there are less crowds. There is some comfort in the Covid era being around crowds… And Fremont Street has its own private security guards…