By Mackenzie Tatananni

MGM Resorts International's fourth-quarter earnings beat analysts' expectations after getting a boost from China. The casino resort operator also said it was "encouraged" by demand so far into 2025.

Fourth-quarter earnings of 45 cents a share topped forecasts for 32 cents, although profit was down from the $1.06 a share reported a year earlier. Revenue also fell 1% to $4.35 billion, but easily surpassed calls for $4.27 billion, according to FactSet.

The marked declines in the quarter were partially offset by "record performance" in Asia. MGM China, a Macau-based resort developer majority-owned by MGM International, saw revenue surge 4% to $1 billion. Management said those gains were largely driven by an increase in casino revenue, which rose 4% to $885 million.

CEO Bill Hornbuckle noted that strong demand so far into 2025 has positioned the company for "continued growth."

"December was our highest convention booking month on record, and in January we saw revenue growth in our Las Vegas Strip Resorts and Regional Operations as well as strong future bookings," Hornbuckle said.

Wall Street appears to believe in the MGM growth story. Of 25 analysts surveyed by FactSet, 20 rate the stock at Buy or equivalent, while five rate it at Hold.

On Wednesday, Mizuho Securities analyst Ben Chaiken boosted his price target on MGM shares to $60 from $56 while maintaining an Outperform rating.

In Chaiken's view, the stock remains "fundamentally misunderstood," and positive hotel rate growth in 2025 could fuel future gains.

Chaiken isn't the only bull. Seaport Research Partners analyst Vitaly Umansky raised his price target to $48 from $46 and reiterated a Buy rating, arguing that the stock remains "compelling" at its current valuation.

MGM stock jumped 10% to $37.90 in early trading Thursday, putting it on pace for the largest same-day percentage increase since June 24, 2022, when MGM subsidiary LeoVegas acquired Tipico Group's U.S sportsbook and online casino.

As MGM climbed in premarket trading, peers also were gaining. Wynn Resorts and Caesars Entertainment were up 2.8% each.

Write to Mackenzie Tatananni at mackenzie.tatananni@barrons.com

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February 13, 2025 09:11 ET (14:11 GMT)

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