Analyst Praise Pushes MGM Resorts Stock to 13-Year High

The security is up over 165% year-over-year

Digital Content Manager
Jun 24, 2021 at 2:39 PM
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Hospitality and entertainment concern MGM Resorts International (NYSE:MGM) is up 4.3% to trade at a 13-year high of $44.97 at last check. The security earned an upgrade from Deutsche Bank to "buy" from "hold" this morning, in addition to a Street-high price-target hike to $54 from $42. The firm said the company is set to improve margins well beyond the over "30% target" projected by management, while also benefitting from Las Vegas trends such as group bookings and Raiders football. 

The brokerage bunch was mostly bearish towards MGM coming into today, suggesting additional upgrades and/or price-target hikes could be on the horizon. Of the 10 analysts in question, six carried a tepid "hold" rating, while the remaining four said "buy" or better.

The security has been tearing up the charts over the past 12 months, with support from the 80-day moving average, which contained a pullback to the $36 level in May, as well as one to $40.50 mark earlier this month. Longer term, MGM Resorts stock carries a 165.6% year-over-year lead.

MGM's options activity is exploding today. So far, 12,000 calls and 2,668 puts have crossed the tape -- triple the intraday average. The most popular is the weekly 6/25 45-strike call, followed by the 42.50-strike call in the same series, with positions being opened at the latter. 

That said, now may be the right time to weigh in on the equity's next move with options. This is per MGM's Schaeffer's Volatility Index (SVI) of 35%, which stands in the extremely low 1st percentile of readings from the past year. In simpler terms, options players are now pricing in low volatility expectations.

 

 

 

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