MGM Resorts International (MGM), mcap=$16bn, price $41.24 vs $34.50

MGM pitch:
– Casino resort owner/operator.
– Extremely attractive investment – very strong downside protection, line-of-sight to >100% upside, and much greater long-term upside.
– Trades at pre-covid levels, despite repurchasing 22% of shares, selling assets at premium valuations, and having the strongest balance sheet ever.
– Robustly cash-flowing domestic casino’s portfolio covers the current market cap fully.
– 56% ownership of SEHK:2282 is worth a further $6 at current prices and potentially significantly more given the relaxation of the extreme COVID policies that have gutted Macau’s gambling industry over the last 3 years.
– BetMGM is set to become one of the 4 primary players in US online gaming and is best positioned amongst those over the long term.

MGM valuation:
– Very strong downside protection with a line of sight to >100% upside.
– At 12x EBITDA for US domestic operations, $12/share in value for SEHK:2282, and $18.6/share in BetMGM, the company is worth $95/share.

Exp. gain: 100%+

Full write-up (free guest account required):