MGM’s lodges charged $1,000 an evening on common for the Super Bowl, however the inventory suffers a hangover

“We were always concerned — we do great Super Bowl parties here — will it be the kind of even that will drive, given the additional expense of the tickets, et cetera, et cetera?” Hornbuckle mentioned, in response to an AlphaSense transcript of the decision. “The answer was hands-down yes, and particularly rooms.”

MGM’s
MGM,
-5.86%
common every day fee for rooms across the Super Bowl was close to $1,000. In addition, the corporate posted three of the highest 5 income days ever recorded across the recreation, in addition to near-record event-gaming volumes.

That compares with the ADR for Las Vegas Strip Resorts of $295 in the course of the fourth quarter, which included the inaugural Formula 1 race, and with the ADR of $258 within the first quarter of final 12 months, when the Super Bowl was held in Glendale, Ariz.

“The game weekend is typically a strong event for MGM Resorts, but having the game in town amplified those results dramatically,” Hornbuckle mentioned.

MGM’s Las Vegas properties embody Bellagio, MGM Grand, Mandalay Bay, Luxor and New York-New York.

CFRA analyst Zachary Warring reiterated his purchase score on MGM’s inventory and his $59 value goal, which means 38% upside from present ranges.

“We see MGM as the biggest beneficiary of the Super Bowl and continue to believe shares are undervalued,” Warring wrote in a observe to purchasers.

But regardless of how “amazing” the Super Bowl was for MGM, and regardless of the corporate reporting fourth-quarter revenue and income that beat Wall Street’s expectations, the inventory sank 6.3% in afternoon buying and selling, and has tumbled 9% since closing Monday at a six-month excessive.

If there have been some negatives within the fourth-quarter report, the corporate mentioned that though the inaugural F1 race in the course of the quarter was “an incredible success,” the optimistic impact was remoted to MGM’s premium properties.

Another adverse was that whereas Las Vegas Strip Resorts income rose 3% to $2.4 billion, and MGM China income rocketed 462% to $983 million, Regional Operations income fell 12% to $873 million.

The weak spot in regionals was attributed to the results of the union strike at MGM Grand Detroit, and a lower in “high-end table volume” at MGM National Harbor close to Baltimore.

And Chief Financial Officer Jonathan Halkyard mentioned there was additionally some “lingering cyber-incident challenges” that particularly impacted the regional portfolio.

Otherwise, quarterly outcomes beat expectations.

MGM reported late Tuesday web revenue for the quarter to Dec. 31 that rose to $313.5 million, or 92 cents a share, from $284.0 million, or 69 cents a share, in the identical interval a 12 months in the past. Excluding nonrecurring objects, adjusted earnings per share of $1.06 had been properly above the FactSet consensus of 71 cents.

Revenue jumped 21.8% to $4.38 billion, above the FactSet consensus of $4.14 billion, as on line casino income soared 42.3% to $2.20 billion and rooms income grew 12.5% to $1.01 billion.

Meanwhile, meals and beverage income elevated 2.4% to $727.9 million and leisure, retail and different income inched up 0.1% to $422.2 million.

In digital, the corporate mentioned BetMGM met its full-year 2023 targets for each income and second-half profitability.

Looking forward, CEO Hornbuckle mentioned the outlook stays robust. “We’re encouraged by the metrics we’ve seen in our business, including room and rates on the books and in-the-year group attendance and future bookings,” he mentioned, in addition to a sturdy occasion calendar for the Las Vegas.

MGM’s inventory has gained 6.3% over the previous three months, whereas the S&P 500 index
SPX
has superior 10.8%.