CBRE is bullish on MGM Resorts International stock after visiting the Las Vegas Strip operator last week. Strength in MGM’s regional properties, a solid performance in Macau, and a positive outlook for Las Vegas in 2026 are fueling that optimism.
John DeCree, director of equity research at CBRE, said they toured MGM Grand, where a $300 million room remodel of its 4,212 rooms and suites that began in January is ahead of schedule. Management is accelerating the rest of the project during the slower summer months and now expects to complete the renovation by mid-October, two months early, DeCree said in a note to investors.
In addition to the room renovations, MGM is adding new dining venues and attractions, including Netflix Bites (Netflix-show-inspired cuisine) that opened in January and the Palm Tree Beach Club, opening this summer.
MGM also opened a live-dealer studio on the Grand casino floor, available to international BetMGM customers. MGM Grand, the company’s namesake property, remains a key component of the company’s Las Vegas and overall performance, comprising about 11% of MGM’s total Strip room supply, DeCree said. “The room renovations are a meaningful improvement that should help drive average daily rates at the property, particularly as we look into the longer term, given the property’s proximity to the site of the planned A’s stadium.”
CBRE is moderating its Las Vegas EBITDAR estimates for second and third quarter to reflect disruption from the accelerated MGM Grand renovation and, to a lesser extent, more pronounced summer seasonality in Las Vegas.
MGM forecasted a $65 million EBITDAR impact from the Grand renovation, including about $20 million in the first quarter, with most of the balance hitting in the second and third quarter, DeCree said.
“We had built in some conservatism in our Las Vegas estimates; however, the recent slowdown in visitation could make it harder to maintain average daily room rates midweek, particularly for value-oriented properties,” DeCree said. “However, we see continued resilience at the luxury properties and across higher-end customer segments. We remain optimistic for Las Vegas in 2026, given the strong group and event calendar, with MGM’s group bookings pacing up a mid-teens percent range.”
While Las Vegas remains MGM’s primary valuation driver, its diversified business helps offset fluctuations on the Strip. “We are slightly lowering our Las Vegas forecast, but our adjusted cash EBITDA estimate remains largely unchanged, offset by other segments,” DeCree said.
“MGM’s regional segment is outperforming our expectations quarter to date with gaming revenue data indicating mid-single-digit growth in MGM’s key regional markets. The Borgata is a notable standout with May gaming revenue up 19.1%, benefiting from a new Asian gaming area. In Macau, gaming revenue has held up despite trade war concerns and MGM continues to maintain share. Finally, BetMGM raised its 2025 guidance, projecting at least $2.6 billion in revenue, up from $2.4 billion to $2.5 billion and at least $100 million in EBITDA.”
CBRE projects a $48 price target for MGM stock, reflecting a 6.5 times multiple of its 2026 EBITDA. The stock has been trading in the low $30s. Its 52-week high is $47.26.
