Stifel analyst Steven Wieczynski on Wednesday raised his price target on MGM Resorts International's stock, citing the casino company's growth potential in China.
MGM and other major U.S. casino operators have shifted their focus in recent years from Las Vegas to Macau, China's gambling mecca. The popularity of gambling in Las Vegas suffered during the recession as consumers pulled back on spending. Meanwhile, a growing upper and middle class in Asia made Macau a gambling destination.
Wieczynski sees potential for MGM in the U.S. as well as Asia, saying in a research note Wednesday that he thinks Las Vegas' recovery is still in an early stage. He also expects strong growth in Macau over the next few years as the region adds new properties and China's economy picks up.
He also noted that the company's recent refinancing and repayment of some debt helped improve its balance sheet.
The analyst expects that MGM stock will keep rising after having performed better than the broader market this year.
He raised the company's price target from $20 to $26 and kept a "Buy" rating on MGM's shares.
Shares of MGM dipped 7 cents to $19.48 as the broader market slipped. Earlier in the day, the stock peaked at $19.82, its highest point since October 2008. It's up 67 percent this year.
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