MGM Resorts (MGM, Financial) shares have experienced a significant decline, falling by 10.96% following the release of their third-quarter earnings report, which underperformed market expectations. The disappointing results were primarily due to casino revenues not meeting forecasts, alongside an EBITDA that fell short of Wall Street projections.
Analyzing MGM's current stock performance, the company's share price is $36.87. With a market capitalization of approximately $10.95 billion, the stock has shown volatility in its recent performance, influenced by both operational challenges and broader market conditions.
Financially, MGM Resorts is wrestling with some notable challenges. The company displays poor financial strength, currently carrying a significant amount of debt, highlighted by a debt-to-equity ratio of 9.78. Additionally, MGM's Altman Z-score of 0.88 places it in the distress zone, indicating a potential risk of financial instability.
On a more positive note, MGM Resorts has been noted for a few favorable indicators. The Beneish M-Score suggests the company is unlikely to be a financial manipulator, and there have been insider buying transactions recently, reflecting some level of confidence among the company's insiders.
From a valuation perspective, MGM has a GF Value of $68.34, which suggests that the stock might be undervalued, albeit with caution that it could be a "Possible Value Trap." Investors can find more details on the GF Value by visiting the GF Value page.
Lastly, while MGM faces hurdles with its financial metrics and market position, the company's revenue growth prospects remain modest with a 32% revenue growth over the past year, signaling potential in its core operations.
