MGM Resorts Shares Soar On Huge Income Growth

Samantha SharfForbes Staff

Stocks were rising across the casino industry Tuesday, making up prior day losses after a number of analysts lowered April daily revenue estimates for Macau— the Chinese territory that is overtaking Las Vegas as the world gambling capital. The official April numbers will be released in the first week of May.

Shares of MGM Resorts MGM +8.51% International were up close to 8% in midday trading Tuesday, climbing as high as $24.99. The gains came after the company reported better than anticipated earnings results.

In the first quarter MGM brought in $2.6 billion in net revenue, up 12% from a year earlier. Net income came in at $108.2 million, a staggering jump from just $6.5 million last year and sharply ahead of the $42 million Wall Street analysts were expecting. Earnings per share were 21 cents versus an 8 cent estimate.

In a statement on the results CEO Jim Murren noted that at home in the United States the company is “executing on our strategy to drive customer loyalty by increasing incremental convention business to our properties mid-week, hosting the best events on the weekends, and continually bringing new and exciting capital initiatives to our properties.” Murren noted MGM is also making progress on a second property in Macau — also spelled Macao — that is schedule to open in early 2016.

MGM was not the only casino stock gaining Tuesday.

Las Vegas Sands LVS +5.69% shares were up about 5% to as high as $78.35. Last week the company reported $4 billion in net revenue, up 21.4% from the same period a year ago. Net income was up 35.7% to $776.2 and earnings per share were 95 cents, beating the Street by a penny. Despite the beat the stock dropped following that release. Even with Tuesday’s gains the stock is more than $1 short of its pre-report level.

Shares of Wynn Resorts were up about 4% Tuesday peaking at $202.99. Wynn will report first quarter earnings Thursday, May 1. Melco Crown Entertainment, up about % to as much as $34.74, will report on Thursday, May 8.