Seaport Research Partners’ Vitaly Umansky downgraded MGM Resorts (NYSE:MGM) from Buy to Neutral, citing expected headwinds for gaming in both Las Vegas and U.S. regional markets this year.
The MGM Resorts International Thesis: The company has high exposure to the U.S., with over 85% of its casino net revenues generated from U.S. land-based casinos, according to Umansky’s downgrade note.
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Only 13% of MGM Resorts International's brick and mortar casino revenues come from Macau, a region where growth has reaccelerated over the past few months and is expected to grow 9% year-on-year in the back half, he added.
The downgrade in rating for MGM Resorts International is largely driven by "the near term headwinds facing Las Vegas (over the rest of 2025 and into 2026) and the increasing capex (MGM Grand renovations, likely NY casino, and Japan investment) coupled with deteriorating US operating cash flow and the run-up in MGM China stock price," the analyst wrote.
Although the US and Las Vegas in particular are facing headwinds, "we do not expect a major downturn in the US casino market," he further stated.
MGM Price Action: Shares of MGM Resorts International had declined by 0.40% to $37.02 at the time of publication on Tuesday.
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