MGM Mirage Stock Drops After Analysts Lower Expectations
MGM Mirage continues to struggle to navigate through troubled economic waters, as analyst predictions for first-quarter results led to declining stock prices. The stock dropped $1.40 per share, or 2.2 %, to close at $63.33.
Since the gaming market began declining six months ago, MGM has found its stock hovering near a yearly low. Not only has the general economic malaise hurt the company's performance, but the January fire at the Monte Carlo Casino cost over $100 million in lost revenue and damage repairs.
The fire, which effectively closed the Monte Carlo for three weeks, caused the resort's revenue to be off as much as 50% for the quarter. This resulted in the company's ten Las Vegas Strip area hotels showing a drop of 3.5% in income per room.
Dennis Forst of KeyBanc Capital Markets also noted that, while high-roller performance at MGM's Macau location has been good, the average gambler is slower to adopt the place, hurting profit margins.
Forst did predict good long-term results for MGM, based on both partnerships with Dubai World and others, and potential for internal growth. He forecast a per-share earning of 43 cents, down from 47 cents previously expected.
