Why MGM Resorts Stock Jumped After Earnings
Shares of casino stock MGM Resorts (NYSE: MGM) jumped as much as 5.6% in trading on Thursday after the company reported second-quarter financial results. Shares slipped as the day went on but were still up 2.9% at 2:20 p.m. ET.
Revenue jumped 44% versus a year ago to $3.3 billion, and net income was $1.8 billion after a gain related to the deconsolidation of MGM Growth Properties. Adjusted earnings per share were $0.03, and adjusted earnings before interest, taxes, depreciation, amortization, and rent (EBITDAR), which is a proxy for cash flow from resorts, was $920 million.
Analysts were only expecting revenue of $3.0 billion and earnings of $0.24 per share, so on that basis, results were mixed. But investors are clearly valuing the revenue side of the ledger more than earnings right now.
Source Fool.com
