NEW YORK (TheStreet) -- Shares of MGM Resorts International (MGM) fell in morning trading Tuesday after Macau Business Daily estimated that Macau casino operators could suffer a 5% year-over-year revenue decline in the period of June to August.
Morgan Stanley (MS) said Monday that it thinks the revenue decline could continue even further and also noted a labor shortage that could affect the situation.
Macau gaming revenue declined 6.1% year-over-year in August, the third straight month of decline, as China cracked down on corruption. Declining Chinese housing prices also reduced demand from rich VIP customers, according to Reuters.
Gambling revenue from Macau's 35 casinos dropped last month to 28.9 billion patacas, or $3.6 billion, compared to 30.7 billion patacas in the same period one year earlier. Analysts expected a 2% to 6% decline.
The stock was down 3.4% to $22.42 at 11:40 a.m. More than 8.5 million shares had changed hands, compared to the average volume of 7,045,800.
Separately, 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 compelling growth in net income. However, as a counter to these strengths, we also find weaknesses including generally higher debt management risk and weak operating cash flow."