The cards came up aces for MGM as its Las Vegas operations continue to see higher demand, the Macau property is making a comeback after the lockdowns in China, and MGM is getting close to breaking ground on the first casino in Japan, a $10 billion joint being developed with Japan’s ORIX Corp. MGM has a 40% stake in the project.
Sentiment remains bullish on the stock, with 14 of 19 analysts having a Buy or Strong Buy rating and the rest rating it at Hold. At a recent price of around $43.40 a share, the upside potential based on a median price target of $55.50 is 27.9%. At the high price target of $68.00, the upside potential is 56.7%.
The consensus first-quarter revenue estimate is $3.61 billion, which would be up 0.5% sequentially and by 26.7% year over year. MGM is forecast to post EPS of $0.16, compared to a loss per share of $1.53 sequentially and EPS of $0.01 in the year-ago quarter. For the full year, analysts expect EPS of $0.83, much better than last year’s loss per share of $2.74, on sales of $14.77 billion, up 12.5%.
MGM shares trade at 52.1 times estimated 2023 earnings, 35.2 times estimated 2024 earnings of $1.23 and 24.7 times estimated 2025 earnings of $1.75 per share. The stock’s 52-week trading range is $26.41 to $46.23. MGM pays an annual dividend of $0.01 (yield of 0.02%), and total shareholder return for the past year was 7.58%.
NXP Semiconductors
Over the past 12 months, Netherlands-based NXP Semiconductors N.V. (NASDAQ: NXPI) has seen its share price slip by 5.6%, including a gain of more than 11% in the past six months.
Like other European tech companies, NXP has felt the pain of restrictions on business with China. Ten days ago, the EU Chips Act was approved. The legislation includes $47 billion aimed at making the playing field with China and the United States more level. NXP, which makes chips for the auto and 5G networking industries, makes nearly 40% of its total sales to Chinese manufacturers, who then export about half of the NXP imports back to Western customers.
Of 27 analysts covering the company, 14 have a Buy or Strong Buy rating and the rest rate the shares a Hold. At a price of around $161.00 a share, the upside potential based on a median price target of $197.50 is 22.7%. At the high price target of $240.00, the upside potential is 49.1%.
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