MGM gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 133 industry peers in the Hotels, Restaurants & Leisure industry. While MGM seems to be doing ok healthwise, there are quite some concerns on its profitability. MGM has a decent growth rate and is not valued too expensively.

Quickly go to:

1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

MGM had positive earnings in the past year.
In the past year MGM had a positive cash flow from operations.
MGM had positive earnings in 4 of the past 5 years.
Of the past 5 years MGM 4 years had a positive operating cash flow.

1.2 Ratios

The Return On Assets of MGM (0.16%) is worse than 62.41% of its industry peers.
Looking at the Return On Equity, with a value of 2.48%, MGM is in line with its industry, outperforming 57.89% of the companies in the same industry.
Looking at the Return On Invested Capital, with a value of 2.82%, MGM is doing worse than 63.16% of the companies in the same industry.

		Industry Rank	Sector Rank
ROA	0.16%
ROE	2.48%
ROIC	2.82%

ROA(3y)2.54%

ROA(5y)1.55%

ROE(3y)28.15%

ROE(5y)17.7%

ROIC(3y)N/A

ROIC(5y)N/A

1.3 Margins

With a Profit Margin value of 0.38%, MGM is not doing good in the industry: 61.65% of the companies in the same industry are doing better.
MGM's Profit Margin has declined in the last couple of years.
MGM has a Operating Margin (7.90%) which is comparable to the rest of the industry.
MGM's Operating Margin has declined in the last couple of years.
MGM's Gross Margin of 44.65% is in line compared to the rest of the industry. MGM outperforms 43.61% of its industry peers.
MGM's Gross Margin has improved in the last couple of years.

		Industry Rank	Sector Rank
OM	7.9%
PM (TTM)	0.38%
GM	44.65%

OM growth 3Y18.28%

OM growth 5Y-2.59%

PM growth 3Y-29.19%

PM growth 5Y-22.93%

GM growth 3Y-1.78%

GM growth 5Y2.08%

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

MGM has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
The number of shares outstanding for MGM has been reduced compared to 1 year ago.
MGM has less shares outstanding than it did 5 years ago.
MGM has a worse debt/assets ratio than last year.

2.2 Solvency

MGM has an Altman-Z score of 0.77. This is a bad value and indicates that MGM is not financially healthy and even has some risk of bankruptcy.
MGM's Altman-Z score of 0.77 is on the low side compared to the rest of the industry. MGM is outperformed by 69.92% of its industry peers.
MGM has a debt to FCF ratio of 4.70. This is a neutral value as MGM would need 4.70 years to pay back of all of its debts.
MGM has a Debt to FCF ratio of 4.70. This is in the better half of the industry: MGM outperforms 75.94% of its industry peers.
A Debt/Equity ratio of 2.38 is on the high side and indicates that MGM has dependencies on debt financing.
MGM has a Debt to Equity ratio (2.38) which is comparable to the rest of the industry.

		Industry Rank	Sector Rank
Debt/Equity	2.38
Debt/FCF	4.7
Altman-Z	0.77

ROIC/WACC0.35

WACC8.12%

2.3 Liquidity

A Current Ratio of 1.23 indicates that MGM should not have too much problems paying its short term obligations.
MGM has a Current ratio of 1.23. This is in the better half of the industry: MGM outperforms 63.91% of its industry peers.
MGM has a Quick Ratio of 1.19. This is a normal value and indicates that MGM is financially healthy and should not expect problems in meeting its short term obligations.
With a decent Quick ratio value of 1.19, MGM is doing good in the industry, outperforming 65.41% of the companies in the same industry.

		Industry Rank	Sector Rank
Current Ratio	1.23
Quick Ratio	1.19

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WACC

Debt/Equity

How to determine the health of a company

Altman-Z score

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3. Growth

3.1 Past

The earnings per share for MGM have decreased strongly by -32.19% in the last year.
Measured over the past years, MGM shows a very strong growth in Earnings Per Share. The EPS has been growing by 65.28% on average per year.
Looking at the last year, MGM shows a small growth in Revenue. The Revenue has grown by 0.05% in the last year.
The Revenue has been growing slightly by 5.97% on average over the past years.

EPS 1Y (TTM)-32.19%

EPS 3Y-0.18%

EPS 5Y65.28%

EPS Q2Q%-55.56%

Revenue 1Y (TTM)0.05%

Revenue growth 3Y21.22%

Revenue growth 5Y5.97%

Sales Q2Q%1.61%

3.2 Future

The Earnings Per Share is expected to grow by 8.07% on average over the next years. This is quite good.
MGM is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 2.76% yearly.

EPS Next Y-16.83%

EPS Next 2Y-5.5%

EPS Next 3Y4.26%

EPS Next 5Y8.07%

Revenue Next Year0.93%

Revenue Next 2Y1.06%

Revenue Next 3Y1.42%

Revenue Next 5Y2.76%

3.3 Evolution

The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.

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4. Valuation

4.1 Price/Earnings Ratio

The Price/Earnings ratio is 15.68, which indicates a correct valuation of MGM.
MGM's Price/Earnings ratio is a bit cheaper when compared to the industry. MGM is cheaper than 78.95% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 27.30, MGM is valued a bit cheaper.
With a Price/Forward Earnings ratio of 14.71, MGM is valued correctly.
MGM's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. MGM is cheaper than 75.94% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of MGM to the average of the S&P500 Index (24.32), we can say MGM is valued slightly cheaper.

		Industry Rank	Sector Rank
PE	15.68
Fwd PE	14.71

4.2 Price Multiples

91.73% of the companies in the same industry are more expensive than MGM, based on the Enterprise Value to EBITDA ratio.
Based on the Price/Free Cash Flow ratio, MGM is valued cheaply inside the industry as 96.24% of the companies are valued more expensively.

		Industry Rank	Sector Rank
P/FCF	6.8
EV/EBITDA	5.93

4.3 Compensation for Growth

PEG (NY)N/A

PEG (5Y)0.24

EPS Next 2Y-5.5%

EPS Next 3Y4.26%

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5. Dividend

5.1 Amount

MGM has a yearly dividend return of 0.02%, which is pretty low.
Compared to an average industry Dividend Yield of 1.19, MGM has a dividend in line with its industry peers.
Compared to an average S&P500 Dividend Yield of 1.82, MGM's dividend is way lower than the S&P500 average.

		Industry Rank	Sector Rank
Dividend Yield	0.02%

5.2 History

MGM has been paying a dividend for over 5 years, so it has already some track record.

Dividend Growth(5Y)N/A

Div Incr Years0

Div Non Decr Years0

5.3 Sustainability

DP0%

EPS Next 2Y-5.5%

EPS Next 3Y4.26%

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MGM RESORTS INTERNATIONAL / MGM FAQ

What is the fundamental rating for MGM stock?

ChartMill assigns a fundamental rating of 4 / 10 to MGM.

Can you provide the valuation status for MGM RESORTS INTERNATIONAL?

ChartMill assigns a valuation rating of 5 / 10 to MGM RESORTS INTERNATIONAL (MGM). This can be considered as Fairly Valued.

Can you provide the profitability details for MGM RESORTS INTERNATIONAL?

MGM RESORTS INTERNATIONAL (MGM) has a profitability rating of 3 / 10.

What are the PE and PB ratios of MGM RESORTS INTERNATIONAL (MGM) stock?

The Price/Earnings (PE) ratio for MGM RESORTS INTERNATIONAL (MGM) is 15.68 and the Price/Book (PB) ratio is 3.48.

What is the financial health of MGM RESORTS INTERNATIONAL (MGM) stock?

The financial health rating of MGM RESORTS INTERNATIONAL (MGM) is 4 / 10.