NEW YORK (TheStreet) -- MGM Resorts International (MGM) - Get MGM Resorts International (MGM) Report shares are down 2.73% to $19.63 in trading on Friday after the Nevada Gaming Control Board released its December and full year numbers today.
The commission said that casinos statewide generated $11 billion in revenue during the year, a 1.1% decline from the $11.1 billion haul from 2013.
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Despite the drop in revenue, the $11 billion generated was just the second time since 2008 the state has reached that figure and the second consecutive year it has cracked that benchmark.
Gaming revenue from the Las Vegas Strip was down 2.1% to $6.37 billion, ending four consecutive years of increases for the most profitable gaming destination in the state.
Gaming revenue in the month of December fell 8% from the previous year to $950.7 million and 16.4% on the Strip to $555.2 million.
TheStreet Ratings team rates MGM RESORTS INTERNATIONAL as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:
"We rate MGM RESORTS INTERNATIONAL (MGM) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its revenue growth, impressive record of earnings per share growth and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, generally higher debt management risk and weak operating cash flow."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The revenue growth came in higher than the industry average of 9.8%. Since the same quarter one year prior, revenues slightly increased by 0.9%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- MGM RESORTS INTERNATIONAL has improved earnings per share by 20.0% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past year. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, MGM RESORTS INTERNATIONAL continued to lose money by earning -$0.31 versus -$3.61 in the prior year. This year, the market expects an improvement in earnings ($0.49 versus -$0.31).
- The net income growth from the same quarter one year ago has exceeded that of the Hotels, Restaurants & Leisure industry average, but is less than that of the S&P 500. The net income increased by 9.2% when compared to the same quarter one year prior, going from -$22.31 million to -$20.27 million.
- MGM has underperformed the S&P 500 Index, declining 12.16% from its price level of one year ago. Looking ahead, other than the push or pull of the broad market, we do not see anything in the company's numbers that may help reverse the decline experienced over the past 12 months. Despite the past decline, the stock is still selling for more than most others in its industry.
- Although MGM's debt-to-equity ratio of 2.92 is very high, it is currently less than that of the industry average. To add to this, MGM has a quick ratio of 0.52, this demonstrates the lack of ability of the company to cover short-term liquidity needs.
- You can view the full analysis from the report here: MGM Ratings Report