MGM Stock Analysis: Is MGM a Buy After the Vegas Recovery?

MGM Resorts International (NYSE: MGM) is one of the world's largest casino and entertainment companies, with major properties in Las Vegas, regional U.S. markets and Macau, plus growing exposure to online gaming through BetMGM and MGM Digital.

The investment story in 2026 is becoming more interesting because Las Vegas has finally returned to year-over-year revenue growth, while MGM's digital business continues expanding. However, weaker Macau profitability and pressure on hotel metrics mean the recovery isn't completely straightforward.

Las Vegas Recovery Is Finally Showing Up

MGM's Q2 2026 results provided an important signal for investors.

Las Vegas Strip Resorts generated $2.2 billion of revenue, up 3% year over year. Segment Adjusted EBITDAR also increased 3% to $735 million. This marked the company's second consecutive quarter of year-over-year Las Vegas revenue growth. (MGM Resorts Investor Relations)

That is significant because Las Vegas had previously been experiencing softer demand and difficult comparisons.

Gaming was particularly strong. Casino revenue jumped 17%, while table-game win increased 27%. Slot handle was essentially flat, but slot win increased 3%. (MGM Resorts Investor Relations)

So the recovery isn't merely dependent on hotel rooms.

Hotel Performance Is Still a Concern

Not every Las Vegas metric improved.

Room revenue declined 2% year over year, while occupancy remained at 93%. Average daily rate fell 4% to $242, and RevPAR declined 4% to $224. (MGM Resorts Investor Relations)

This tells us something important:

Vegas demand is improving, but pricing power isn't yet back to previous levels.

For MGM, sustained recovery in room rates and RevPAR could provide another earnings catalyst.

Overall Financial Results

MGM reported record Q2 consolidated revenue of $4.5 billion, up 1% year over year.

Net income attributable to MGM increased dramatically to $292 million, compared with $49 million in the prior-year quarter. Diluted EPS rose to $1.11 from $0.18. (MGM Resorts Investor Relations)

However, adjusted EPS actually declined to $0.59 from $0.79, while consolidated Adjusted EBITDA decreased to $610 million from $648 million. (MGM Resorts Investor Relations)

Therefore, investors shouldn't look only at the headline net-income increase.

The underlying operating picture remains mixed.

Macau Remains a Weak Spot

MGM China generated approximately $1.1 billion in Q2 revenue, roughly flat year over year.

More concerning was Segment Adjusted EBITDAR, which declined 15% to $257 million. (MGM Resorts Investor Relations)

This means the Macau business is currently creating some pressure on overall profitability.

The positive side is that MGM says it is gaining market share in Macau. If the market environment improves and margins recover, this business could become an important earnings catalyst.

BetMGM Is Becoming More Important

MGM isn't only a casino operator anymore.

BetMGM's Q2 2026 net revenue increased 3% to $711 million, while iGaming revenue increased 8% to $483 million. Adjusted EBITDA was $74 million. (MGM Resorts Investor Relations)

The business expects 2026 net revenue of $2.9–$3.1 billion and Adjusted EBITDA of $300–$350 million, although management expects results toward the lower end of those ranges. (MGM Resorts Investor Relations)

That's important because online gaming can provide a scalable growth engine beyond physical casinos.

However, competition remains intense, and BetMGM's average monthly active users declined 3% in Q2 and 6% during the first half of 2026. (MGM Resorts Investor Relations)

MGM Digital Is Growing Rapidly

MGM Digital, which includes LeoVegas and other consolidated interactive businesses but excludes the BetMGM North America venture, generated $196 million of Q2 revenue, up approximately 20% year over year. (MGM Resorts Investor Relations)

The segment still reported an Adjusted EBITDAR loss of $31 million.

So this is currently a growth investment rather than a major profit contributor.

If MGM can convert that revenue growth into sustainable profitability, the market could assign greater value to its digital operations.

Share Buybacks Are a Major Positive

One of the strongest parts of the MGM investment thesis is capital allocation.

During Q2, MGM repurchased approximately 4 million shares for $164 million. The company still had about $1.4 billion remaining under its April 2025 repurchase authorization at the end of June. (MGM Resorts Investor Relations)

Buybacks can be especially powerful when a company believes its shares are undervalued.

Reducing the share count can increase EPS and allow existing shareholders to own a larger percentage of the company's future cash flows.

MGM Osaka Provides Long-Term Growth

MGM is also investing in a major new integrated resort in Japan.

MGM Osaka is currently targeted for a 2030 opening, giving the company another potential long-term growth engine beyond Las Vegas and Macau. (MGM Resorts Investor Relations)

The project requires significant investment, so it isn't an immediate earnings catalyst.

But if Osaka becomes a successful integrated resort, it could materially expand MGM's international footprint.

Why MGM Could Rally

Several catalysts could push MGM shares higher:

• Continued Las Vegas revenue growth

• Recovery in hotel RevPAR and room rates

• Stronger casino win

• Macau margin recovery

• BetMGM profitability

• MGM Digital growth

• Share repurchases

• Successful MGM Osaka development

• Improved consumer spending

The most important near-term catalyst is probably continued Las Vegas operating improvement.

If revenue growth accelerates while hotel pricing and margins recover, earnings could improve substantially.

Major Risks

1. Las Vegas slowdown

If tourism, conventions or consumer spending weaken, MGM's biggest U.S. market could suffer.

2. Macau volatility

MGM China remains exposed to the Chinese economy, tourism trends and regulatory conditions.

3. Online gaming competition

BetMGM operates in an increasingly competitive sports-betting and iGaming market.

4. Capital spending

Large development projects such as MGM Osaka require substantial capital.

5. Economic recession

Casinos and resorts are discretionary businesses. Consumers tend to reduce entertainment spending during severe economic downturns.

Is MGM a Buy?

At around the mid-$40s, MGM's valuation makes the stock interesting for investors who believe the Las Vegas recovery can continue.

The company isn't a pure growth stock. Instead, it combines:

Las Vegas + Macau + regional casinos + BetMGM + digital gaming + aggressive buybacks.

That diversified structure creates multiple potential sources of value.

The biggest question is whether the improving Las Vegas numbers can eventually translate into stronger company-wide Adjusted EBITDA and EPS growth.

Final Verdict

MGM looks increasingly attractive after the Vegas recovery, but it remains a cyclical and higher-risk investment.

The strongest signal is that Las Vegas Strip revenue has now grown year over year for two consecutive quarters, with Q2 revenue up 3% and Strip EBITDAR up 3%. (MGM Resorts Investor Relations)

At the same time, Macau profitability remains weak, hotel RevPAR is down and BetMGM is guiding toward the lower end of its 2026 targets. (MGM Resorts Investor Relations)

Bottom line: MGM could be an attractive value-and-recovery play if Las Vegas continues strengthening and digital businesses become increasingly profitable. The aggressive buyback program adds another potential catalyst.

Verdict: MODERATELY BULLISH — BUY ON WEAKNESS / LONG-TERM HOLD.

This article is for informational and educational purposes only and is not personalized financial advice.