Fewer High Rollers Costs MGM Resorts
Shares of MGM Resorts International (NYSE: MGM) dropped this morning after the company reported a larger-than-expected loss in the third quarter. The company posted an earnings per share (EPS) loss of $0.37, compared with a consensus estimate of loss of $0.17 and a loss of $0.14 in the third quarter of 2013.
Revenues rose 1% to $2.3 billion on the strength of MGM's Macau casino. Yesterday Ceasars Entertainment Corp. (NASDAQ: CZR) said that it would abandon its plans for a Macau casino after trying for five years to get permission to build on a property it had paid $578 million for. Wynn Resorts Ltd. (NASDAQ: WYNN) reported lower revenues in Macau on its third-quarter, although the company was able to boost its Las Vegas revenues to make up the difference.
Like Wynn, MGM said its VIP table-games revenue fell in Macau. MGM's turnover fell 5% year-over-year and Wynn's fell 12.1%. The drop is certainly due to new restrictions enacted by the mainland Chinese government earlier this year that limits both visas to travel to Macau and the amount of credit available to gamblers.
MGM's shares are down about 4% today, at $10.16 in a 52-week range of $8.83 to $14.94. Shares of Ceasars are down 1.2% at $5.78, after posting a new 52-week low of $5.69 earlier today. The prior range was $5.80 to $17.90.
Filed under: 24/7 Wall St. Wire, Casinos & Hotels, China, Earnings Tagged: CZR, MGM, WYNN