5 Best Casino Stocks to Invest In

2. MGM Resorts International (NYSE: MGM)

Number of Hedge Fund Holders: 57 

MGM Resorts International (NYSE: MGM) is a leading entertainment company headquartered in Las Vegas, Nevada. The company owns over 29 hotels and casinos in many U.S. states such as Mississippi, Massachusetts, New Jersey, Maryland, etc., as well as Macau. Recently, the company has announced its acquisition of Infinity World’s remaining 50% stake in CityCenter Holdings for $2.1 billion. It ranks second on our list of the best casino stocks to invest in. 

MGM Resorts International (NYSE: MGM) reported strong earnings for Q1 2021 due to the Las Vegas Strip recovery and increasing casino demand. The company reported net earnings of $332 million and an EPS of -$0.69, beating the market estimate by $0.16. MGM China saw a 9% increase in revenues at $296 million. The company announced a quarterly dividend of $0.0025 per share and paid over $119 million to shareholders in its stock repurchase plan. In the past year, the shares of MGM stock have soared by 151.9% and 35.7% year to date. Earlier, JP Morgan also raised its price target on the stock to $52 due to the Las Vegas Strip revenues returning to 2019 levels. 

As of Q1 2021, we see that hedge funds are turning bullish on MGM Resorts International (NYSE: MGM), as 57 hedge funds have positions in the company, compared with 44 in the previous quarter. Corvex Capital is the largest shareholder of the company with over 15.6 million shares, worth $595 million. 

Longleaf Partners Fund recently published its first-quarter 2021 investor letter and mentioned MGM Resorts International (NYSE: MGM) and other stocks in it. Here is what the firm has to say: 

“MGM (21%, 1.44%), the casino and online gaming company, also contributed to the Fund’s strong returns. MGM’s Las Vegas properties performed particularly well during the fourth quarter, with October marking the best month since pre-COVID February, positive quarterly EBITDA and strong 2021 bookings. MGM’s online gaming and sportsbetting app, BetMGM, is one of the leaders in US online gaming, with a better market share in the more profitable iGaming than in the higher profile but lower margin sports gaming. MGM has demonstrated high conversion rates of its hotel guests and we believe that, with Barry Diller’s help, they will build a competitive long-term advantage with lower customer acquisition costs. MGM’s Macau subsidiary, MGM China, also appreciated as the Macau market partially reopened. We believe there is significant additional upside for the Macau business over the medium-to-long term.”