In a research note published Wednesday, Deutsche Bank analyst Carlo Santarelli maintained a Buy rating on Mgm Resorts International (NYSE:MGM) but slightly reduced his price target to $29 (from $30), which implies an upside of 42% from current levels.
Santarelli noted, “While Macau fundamentals remain challenging and Consensus estimates for the Macau asset remain lofty, we see shares as meaningfully oversold given still favorable LV Strip (60% of Company EBITDA) fundamentals and domestic asset optionality.”
“Accordingly, we are reaffirming our Buy rating, despite our negative revisions (all Macau related) and lower price target. At current levels, we see the n on-Macau portion of MGM trading at 8.6x our 2016 forecast. At these levels, we believe MGM Cotai, a Vegas acceleration, Springfield and National Harbor, and upside to our current, well below Consensus Macau forecast, are all free.”
According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Carlo Santarelli has a total average return of 7.3% and a 52.8% success rate. Santarelli has a -0.7% average return when recommending MGM, and is ranked #772 out of 3429 analysts.