Here's Why Investors Should Retain MGM Resorts Stock for Now

MGM Resorts International MGM is likely to benefit from strong Las Vegas performance, strategic capital investments and a solid digital business. Also, the emphasis on diversifying revenue streams with non-gaming attractions bodes well. However, elevated expenses remain a concern.Let us discuss the factors that highlight why investors should retain the stock for now.Factors Driving Growth of MGM StockMGM Resorts continues to showcase strong financial performance, driven by record-breaking domestic operations and strategic international expansion. The company achieved all-time highs in consolidated net revenues in 2024, with its Las Vegas segment reaching new records in slot handle and hotel revenues. Early 2025 trends indicate sustained momentum, with average daily rates projected to increase throughout the year.Strategic investments remain a key pillar for MGM’s growth. The company has enhanced its Las Vegas properties, including major renovations at the Bellagio and the full integration of the Cosmopolitan into the MGM Rewards program. Its meetings and conventions segment continues to thrive, with record-breaking bookings and a $100 million investment in the Mandalay Bay Convention Center. These efforts position MGM as a dominant player in the premium hospitality market, reinforcing its competitive advantage.MGM’s digital segment is also expanding rapidly, particularly through BetMGM, which generated over $2 billion in net revenues in 2024 and is expected to reach $2.4-$2.5 billion in 2025. With EBITDA now positive and strategic acquisitions strengthening its online gaming capabilities, MGM is solidifying its foothold in the growing digital betting space. Meanwhile, MGM China has exceeded expectations, securing over 16% market share in Macau and delivering its highest-ever full-year adjusted EBITDA. The company’s focus on diversifying revenue streams with non-gaming attractions further enhances its long-term growth prospects.With robust financials, strategic investments and expanding global operations, MGM is well-positioned for continued success. Its strong presence in Macau, advancements in digital gaming and upcoming projects in Osaka and New York present compelling growth opportunities.Concerns for MGM StockImage Source: Zacks Investment ResearchShares of MGM Resorts have declined 7.9% in the past three months compared with the industry’s 3.6% fall. The downside was due to an uncertain macroeconomic environment.The company has been witnessing elevated operating expenses for some time. For the fourth quarter, MGM Resorts reported increased expenses concerning casino, room and food and beverage. During this time period, casino expenses were $1.26 billion compared with $1.24 billion reported in the prior-year period. The company is cautious of cost overruns, which are likely to impact the bottom line to some extent in 2025. It also remains cautious of wage inflation.MGM’s Zacks Rank and Stocks to ConsiderMGM Resorts currently carries a Zacks Rank #3 (Hold).Some better-ranked stocks in the Zacks Consumer Discretionary sector include:RCI Hospitality Holdings, Inc. RICK currently sports a Zacks Rank #1 (Strong Buy). RICK delivered a trailing four-quarter earnings surprise of negative 62.9%, on average. The stock has declined 15.5% in the past year. You can see the complete list of today’s Zacks #1 Rank stocks here.The Zacks Consensus Estimate for RICK’s 2025 sales and EPS indicates growth of 2.5% and 1,278.8%, respectively, from year-ago levels.Mattel, Inc. MAT currently flaunts a Zacks Rank #1. MAT delivered a trailing four-quarter earnings surprise of 37.6%, on average. The stock has gained 1.5% in the past year.The Zacks Consensus Estimate for MAT’s 2025 sales and EPS indicates growth of 1.4% and 4.9%, respectively, from year-ago levels.Royal Caribbean Cruises Ltd. RCL currently carries a Zacks Rank #2 (Buy). RCL delivered a trailing four-quarter earnings surprise of 15.7%, on average. The stock has surged 57.8% in the past year.The Zacks Consensus Estimate for RCL’s 2025 sales and EPS indicates growth of 9% and 26.4%, respectively, from year-ago levels.Zacks Names #1 Semiconductor StockIt's only 1/9,000th the size of NVIDIA which skyrocketed more than +800% since we recommended it. NVIDIA is still strong, but our new top chip stock has much more room to boom.With strong earnings growth and an expanding customer base, it's positioned to feed the rampant demand for Artificial Intelligence, Machine Learning, and Internet of Things. Global semiconductor manufacturing is projected to explode from $452 billion in 2021 to $803 billion by 2028.See This Stock Now for Free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Royal Caribbean Cruises Ltd. (RCL): Free Stock Analysis Report Mattel, Inc. (MAT): Free Stock Analysis Report MGM Resorts International (MGM): Free Stock Analysis Report RCI Hospitality Holdings, Inc. (RICK): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks