NEW YORK (TheStreet) -- MGM Resorts International (MGM) shares closed trading down 4.97% to $18.83 in intraday trading on Tuesday after the Nevada-based gaming company reached a last-minute deal to avoid a trial over a never completed tower on the Las Vegas Strip.
The trial between the company and the six contractors who were responsible for building the Harmon resort was slated to last a year or more. Jurors reportedly gasped when they heard that a deal had been reached, according to the Associated Press.
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Work on the building was halted in 2008 after inspectors found that the steel used on the bottom half of the building would not be strong enough to support the weight of the full building.
MGM claimed that the flaws in the building were due to contractor negligence while the contractors countered that the company failed to pay the necessary amount for the right steel. The details of the settlement were not made public and neither party publicly admitted fault for the incident.
MGM shares are down 0.27% to $18.80 in after-hours trading today.
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."