MGM Resorts International
) recently inked an agreement with AEG - one of the leading
sports and entertainment presenters in the world - to set up a
high-end 20,000-seat indoor sports and entertainment facility at
the popular Las Vegas Strip. The new arena would serve as a venue
for boxing matches and other sporting events, entertainment shows
and other special events.
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MGM presently boasts nine casino hotels in the Las Vegas Strip
namely Bellagio, MGM Grand, Mandalay Bay, The Mirage, Luxor, New
York-New York, Excalibur, Monte Carlo and Circus Circus. The
upcoming sports facility will be located between New York-New
York and Monte Carlo.
We believe this new venture will further enhance the MGM brand in
the highly competitive Las Vegas Strip. In fact, MGM's entry to
the world of boxing, sports, concerts and other events will help
the entire Las Vegas market garner considerable footfall and
The project will also feature new retail shops, dining and
entertainment offerings, especially at the New York-New York and
Monte Carlo properties which should boost guest occupancy at both
The latest deal, which is to be financed with equity
contributions from each of the partners as well as
privately-funded third-party financing, also marks a
diversification from MGM's age-old casino business. Given, its
dominant position in arena development and management, AEG also
makes a strategically fit partner.
MGM Resorts currently retains a Zacks Rank #3 (Hold). Other
players in the casino gaming industry, which look attractive at
current levels include
Boyd Gaming Corp.
International Game Technology
Melco Crown Entertainment Limited
), all carrying a Zacks Rank #2 (Buy).