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Will China Operations Drive MGM Resorts' (MGM) Q3 Earnings?

Zacks Equity Research

MGM Resorts International MGM is scheduled to report third-quarter 2019 results on Oct 30. In the last reported quarter, the company’s earnings missed the Zacks Consensus Estimate by 8%.

Q3 Expectations

The Zacks Consensus Estimate for third-quarter earnings is pegged at 29 cents, indicating an improvement of 20.8% from the year-ago quarter figure. Over the past 30 days, the company’s earnings estimates have been revised downward by 2 cents. For quarterly revenues, the consensus mark is pegged at $3,370 million, suggesting growth of 11.3% from the prior-year reported figure.
Let’s take a look at how things are shaping up prior to this announcement.

Factors Likely to Impact Q3 Results

MGM Resorts’ third-quarter results are likely to have benefited from robust performance of both China and domestic operations. Further, the consensus mark for revenues from operations in China stands at $762 million, indicating an improvement of 25.7% from the year-ago quarter. Robust convention and room rate are likely to get reflected in the third-quarter results.

The company’s Las Vegas operation is likely to have benefited from improving economic scenario and increased tourism numbers. Meanwhile, MGM Resorts has been consistently making important investments wherever it sees an opportunity. Moreover, the company’s third quarter results are likely to reflect its solid business model and extensive non-gaming revenues.

MGM Resorts International Price and EPS Surprise


MGM Resorts International Price and EPS Surprise

MGM Resorts International price-eps-surprise | MGM Resorts International Quote

What Does the Zacks Model Say

Our proven model does not conclusively predict an earnings beat for MGM Resorts this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that's not the case here.

You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Although MGM Resorts has a Zacks Rank #3, its Earnings ESP of -24.51% makes surprise prediction difficult.

Stocks Poised to Beat Earnings Estimates

Here are some stocks from the Zacks Consumer Discretionary space that investors may consider, as our model shows that these have the right combination of elements to deliver an earnings beat in third-quarter 2019.

Deckers Outdoor Corporation DECK has an Earnings ESP of +3.17% and a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

Fox Corporation FOXA has an Earnings ESP of +2.90% and a Zacks Rank #3.

Wyndham Destinations, Inc. WYND has an Earnings ESP of +0.14% and a Zacks Rank #3.

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MGM Resorts International (MGM) : Free Stock Analysis Report
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WYNDHAM DESTINATIONS, INC. (WYND) : Free Stock Analysis Report
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