MGM Resorts: A Value Stock with Hidden Growth Opportunities
MGM Resorts International (MGM), with a market capitalization of around $12.5 billion, is a leading resort and casino company in the United States and Macau. The company’s portfolio consists of 29 unique destination properties in the U.S. and Macau, as well as the MGM National Harbor in Maryland. MGM’s diverse offerings include luxury and contemporary hotels, gaming, world-class entertainment, and award-winning dining.
Growth Opportunities
Despite its dominant position in the industry, MGM is currently priced like a value stock. This mispricing can be attributed to several factors, including ongoing restructuring efforts and increased competition in the U.S. market. However, these challenges also create significant growth opportunities for MGM.
Online Gaming
One of the most promising growth areas for MGM is online gaming. The company has already made strides in this space, with partnerships in place to offer online sports betting and casino games in various jurisdictions, including New Jersey, Pennsylvania, and Michigan. As more states legalize online gaming, MGM is well-positioned to capitalize on this trend.
- New Jersey: MGM’s Borgata Casino is a market leader in New Jersey’s online gaming market.
- Pennsylvania: MGM’s partnership with the Meadows Racetrack and Casino allows the company to offer online gaming in the state.
- Michigan: MGM’s partnership with the Soaring Eagle Casino and Resort enables the company to offer online gaming in Michigan.
Upcoming Resort in Japan
Another growth opportunity for MGM is its upcoming integrated resort in Japan. The company was selected as one of the three preferred bidders for the Osaka Yumeshima project, which is expected to be a major tourist destination. The resort will include a hotel, casino, retail space, and various entertainment offerings. This project represents a significant investment for MGM, but the potential rewards are substantial.
Impact on Consumers
For consumers, the growth opportunities for MGM mean more choices when it comes to casino and entertainment experiences. As the company expands its online gaming offerings, consumers in more states will have access to a wider range of games and betting options. Additionally, the opening of the integrated resort in Japan is expected to attract tourists from around the world, creating new opportunities for travel and entertainment.
Impact on the World
On a larger scale, the growth opportunities for MGM could have a significant impact on the global gaming industry. As more jurisdictions legalize online gaming and more integrated resorts are built, the competition in the industry is likely to increase. However, companies like MGM that are able to adapt and innovate will be well-positioned to capture market share and thrive in this evolving landscape.
Conclusion
MGM Resorts International may be priced like a value stock, but its growth opportunities in online gaming and its upcoming integrated resort in Japan make it an intriguing long-term investment. For consumers, these developments mean more choices when it comes to casino and entertainment experiences. For the world, they represent a significant shift in the global gaming industry, with increased competition and innovation driving growth and expansion.
As MGM continues to navigate these opportunities, it will be important for the company to remain agile and adapt to the changing market. With its strong brand and diverse offerings, MGM is well-positioned to succeed in this dynamic landscape.
