MGM changes
Pick any two versions below to diff them.
- Price
- $28.60 → $29.96(+4.8%)
- Next earnings
- Oct 28, 2026 → Jan 28, 2027
- Next earnings is estimate
- No → Yes
- Thesis
- The market prices MGM for weak results and for the end of a buyout proposal. On June 1, 2026, IAC, now People Inc., proposed to buy all other shares for $48.30 per share in cash, and on September 23, 2026, it withdrew the proposal. In removed: Q2 added: Q3 2026, added: RevPAR on the Las Vegas Strip removed: revenue rose 3%, but RevPAR fell removed: 4%, added: 8% on lower room rates, and Las Vegas Strip Segment Adjusted EBITDAR fell 12%. MGM China's Segment Adjusted EBITDAR fell removed: 15%, and MGM Digital lost money and took added: 7% because it paid a removed: goodwill impairment of $111 added: higher branding fee, and consolidated Adjusted EBITDA fell to $403 million from $506 million. MGM also has large lease payments. For the gap to close, three things must be true. Las Vegas Strip removed: revenue added: room rates and EBITDAR must removed: keep growing. added: grow again. MGM added: said that October 2026 rebounded. MGM China must keep its margins while it pays removed: a added: the higher branding fee. MGM Digital must removed: lower added: keep its removed: losses, added: losses small, and MGM must removed: continue to repurchase shares with added: use the $1.4 billion left under its removed: plan. added: plan to repurchase shares. On October 27, 2026, People Inc. removed: said that it is still open added: agreed to removed: a strategic transaction, which could also close added: stay at or below 29.9% of the removed: gap, but no new offer exists. The Q3 2026 report on October 28, 2026 added: shares and added: to vote with the added: board on a change of control, and MGM said that this supports share repurchases. No transaction is contemplated. The Q4 removed: report added: 2026 report, expected in added: late January or early February removed: 2027 give added: 2027, gives the next evidence. The gap closes slowly, over two to three years, unless a removed: new transaction comes. The main reason it may not close is weak demand in Las Vegas, which would lower room rates and gaming revenue.
- Risks
- Las Vegas depends on travel and consumer spending. RevPAR on the Las Vegas Strip fell removed: 4% added: 8% in removed: Q2 added: Q3 2026, and removed: weaker added: Las Vegas Strip Segment Adjusted EBITDAR fell 12%. Weaker demand can lower room rates and gaming revenue further. MGM pays large rents for the resorts that it leases. Operating lease liabilities were removed: $23.78 added: $23.86 billion at removed: June added: September 30, 2026. These fixed payments make earnings fall fast when revenue falls. Macau results depend on China's economy and rules. MGM China's Segment Adjusted EBITDAR fell removed: 15% added: 7% in removed: Q2 added: Q3 2026, partly because removed: of a higher added: its branding fee to removed: MGM. MGM added: rose by $22 million. MGM Digital loses removed: money, added: money. Its Segment Adjusted EBITDAR loss was $61 million in the first nine months of 2026, and MGM recorded a goodwill impairment of $111 million for it in Q2 2026. More losses or write-downs are possible. added: MGM must still fund about JPY333 billion (about $2.1 billion) of its commitment to MGM Osaka at September 30, 2026, and it guarantees funding for the completion of the resort without a cap. Higher building costs can need more cash.
- Balance sheet
- Cash: removed: $2.5B added: $2.4B Debt: removed: $6.1B added: $5.7B Net debt: removed: $3.5B added: $3.3B Interest cover: removed: 4.0× added: 3.0× Undrawn credit line: $2.3B At removed: June added: September 30, 2026, removed: long-term debt added: principal was removed: $6.07 added: $5.70 billion, and cash was removed: $2.55 added: $2.40 billion. added: In September 2026, MGM removed: classifies debt due within one year as long-term because it intends and is able to refinance it; that debt includes added: repaid its $400 million of removed: senior added: 4.625% notes due removed: 2026. MGM's own added: 2026 with cash on hand. MGM China holds $2.33 billion of the debt added: and $598 million of the cash. Its debt includes notes due from removed: 2026 added: 2027 to removed: 2036, added: 2033 and removed: MGM China has added: $331 million drawn on its removed: own added: revolving credit facility. The rest of the debt includes MGM's notes added: due from 2027 to 2036 and a removed: revolving added: senior secured yen credit removed: facility, on which added: facility of $344 removed: million was drawn. added: million. No amounts were drawn on MGM's $2.3 billion revolving credit facility. Interest cover is operating income divided by interest expense for the first removed: half added: nine months of 2026. added: That operating income includes a net gain of $265 million on property transactions. Operating lease liabilities, mostly for resorts leased from VICI Properties, were removed: $23.78 added: $23.86 billion more. As of removed: Jun added: Sep 30, 2026.
- Checkpoints
- Oct 28, 2026: Q3 2026 earnings: Las Vegas and Macau. removed: Pending. added: Failed. Watch: Growth in Las Vegas Strip EBITDAR and stable MGM China margins pass; a fall in Las Vegas EBITDAR fails. removed: Feb added: Outcome: Las Vegas Strip Segment Adjusted EBITDAR fell 12% on lower room rates, and MGM China's Segment Adjusted EBITDAR fell 7%. Jan 28, 2027 (estimate): Q4 2026 earnings: added: Las Vegas recovery and digital losses. Pending. Watch: removed: Smaller added: Growth in Las Vegas Strip Segment Adjusted EBITDAR, smaller MGM Digital losses and continued share repurchases pass; removed: larger losses added: another fall in Las Vegas EBITDAR or a stop to repurchases removed: fail. added: fails.
- Recent events
- added: Oct 28, 2026: MGM reported Q3 2026 results. Revenue was $4.2 billion, down 1%. Las Vegas Strip revenue fell 2% to $2.0 billion, RevPAR fell 8%, and Segment Adjusted EBITDAR fell 12% to $531 million. MGM China revenue rose 5% to a record $1.1 billion, but its Segment Adjusted EBITDAR fell 7% to $264 million, as its branding fee to MGM rose by $22 million. The MGM Digital loss fell to $4 million of Segment Adjusted EBITDAR from $23 million. Adjusted EPS was a loss of $0.11, compared with a profit of $0.24 a year earlier. MGM said that October 2026 rebounded in Las Vegas. Oct 27, 2026: MGM amended its voting agreement with People Inc. and Barry Diller, and it announced the change on October 28. People Inc. agreed not to buy shares that would take its group above 29.9% of MGM's shares. On a change of control, it will vote all its shares as the board recommends, subject to conditions. MGM agreed not to take defensive measures against People Inc. while it complies. MGM said that no transaction is contemplated. People Inc. owns about 26.5% of MGM's shares. Sep 23, 2026: People Inc., formerly IAC, withdrew its non-binding proposal to buy all MGM shares that it does not own. It said that it remains open to a strategic transaction with MGM. It owns about 26.5% of MGM's shares. Jul 29, 2026: MGM reported Q2 2026 results. Revenue was $4.5 billion, up 1%. Las Vegas Strip revenue rose 3% to $2.2 billion, while RevPAR fell 4%. MGM China's Segment Adjusted EBITDAR fell 15% to $257 million, and MGM Digital recorded a goodwill impairment of $111 million. Adjusted EPS was $0.59, compared with $0.79 a year earlier. In April 2026, MGM sold the operations of MGM Northfield Park for $546 million, and its annual rent to VICI fell by $53 million. Jun 1, 2026: IAC proposed to buy all MGM shares that it did not own for $48.30 per share in cash. The proposal was non-binding. May 13, 2026: MGM China Holdings sold $750 million of 6.25% senior notes due 2033. Apr 3, 2026: MGM signed a voting agreement with IAC and Barry Diller. When they own more than 25.73% of MGM's voting power, they vote the extra shares in the same proportion as the other shareholders.