Must-know: MGM’s relative share price performance
By Shawn BoltonUpdated
Recent performance
Share prices for most of the gambling stocks declined significantly over the last three months. Melco Crown Entertainment (MPEL) collapsed by 21.7%. It was followed by MGM Resorts’ (MGM) 14.9% decline. Las Vegas Sands (LVS), Boyd Gaming (or BYD), and Wynn Resorts (WYNN) declined 12.5%, 10.4%, and 9.2%, respectively, during the same time period.
However, share prices for all of these companies showed improved performance over the last week. For instance, BYD surged 8.4%. It was followed by LVS and MGM at 5.6% and 4.6%, respectively. MPEL and WYNN strengthened ~3.3%.
MGM’s relative performance
The above chart shows that MGM’s peers—like WYNN, LVS, and MPEL—outperformed MGM and the S&P 500 over the last five years.
MGM returned ~77% over the last five years—compared to peer group average return of ~180%. MPEL had the maximum return of ~307% among its peers. It was followed by LVS’ return of ~258%. BYD had a negative return of ~21% during the same time period.
A good way for investors to get exposure to these companies is to invest in an exchange-traded fund (or ETF) like the Consumer Discretionary Select Sector SPDR Fund (XLY).
However, if we look at the year-to-date (or YTD) performance, MGM outperformed the peer group. It had a negative return of 7.4%—compared to its peer group’s negative return of ~23.3% during the same period.
In the next part of the series, we’ll discuss how MGM’s mass table win outperformed the market.