MGM Stock Risk/Reward Points to Upside, Says Analyst
Posted on: April 7, 2026, 11:26h.
Last updated on: April 7, 2026, 11:26h.
- Las Vegas Strip growth likely to be a second half story
- That growth can be achieved without a resurgence among value customers
- Analyst says MGM’s digital, regional casino and Macau businesses are healthy
MGM Resorts International (NYSE: MGM) stock is higher by nearly 4% year-to-date, indicating investors may be at peace with a slow growth outlook for the Las Vegas Strip.
That’s what they should expect as Stifel analyst Steven Wieczynski points out in a new report that Strip earnings before interest, taxes, depreciation and amortization (EBITDA) growth will be a second half theme. MGM recently announced value packages, targeting price-sensitive consumers likely to stay at properties such as Excalibur and Luxor – venues that combine for 6% of the operator’s EBITDA. Even if that strategy doesn’t pay dividends, MGM can engineer second half Strip growth, potentially benefiting the stock along the way.
Even if the low-end value customer doesn’t return in full force, we still see a path to 2H26 Strip growth,” says Wieczynski. “While things might not improve overnight, we believe for the patient investor, owning shares of MGM at current levels is an overly compelling risk/reward. We think the market has priced in more than enough LV Strip leisure ‘weakness’, and at this point we believe forward indicators (even though the booking window does remain compressed) are encouraging as we look out into 2H26.”
He reiterates a “buy” rating on the stock while paring his price target to $48 from $50. The analyst says “any signs of life around the Las Vegas Strip leisure traveler” have the potential to spark shares of MGM, possibly at a brisk pace.
Signs of Stability in Las Vegas
In what’s good news for MGM stock, the situation on the Strip isn’t deteriorating. It’s actually stable and that could provide a foundation for a second half rebound.
As Wieczynski points out, Las Vegas leisure demand is stable and there’s no evidence of significant consumer spending retrenchment on the weekends or during marquee events. MGM is the largest operator on the Strip where it controls 36,645 hotel rooms, far more than second-place Caesars Entertainment (NASDAQ: CZR), which has 23,150 rooms.
Regarding MGM’s recent marketing efforts geared toward value-conscious consumers, those could pay off, but it will take a few months. For now, investors aren’t ascribing benefits to the share price by way of the operator’s renewed focus on the value segment.
“MGM has started to market (see their bundling packages) more aggressively to the lower-end customer, and we expect that will benefit the market, but not until 2H26,” adds Wieczynski. “Based on where shares of MGM are currently trading, we don’t believe the market has factored in any material contribution from the low-to-mid leisure cohort for the remainder of 2026, and honestly, probably not even in 2027.”
MGM Isn’t Just a Las Vegas Story
A point of allure with MGM stock is that it’s not solely a Las Vegas story. It’s regional casino business is solid. BetMGM, in which MGM owns 50%, is coming off its first profitable year in 2025 and is positioned to deliver 2027 EBITDA of $500 million and MGM China is delivering impressive results.
Wieczynski argues that diversity provides a buffer to the broader MGM investment thesis until the Las Vegas segment bounces back, but that protection is glossed over by some investors.
“While overall growth around MGM’s core brick and mortar business will remain subdued, we believe growth coming out of Macau, Digital, and stronger than expected LV group and convention business will be enough for investors to ascribe a higher multiple versus where MGM shares are currently trading,” concludes the analyst.
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