MGM Tops Forbes 2000 List in Gaming Industry Leaders
MGM Resorts International ranks highest among gaming companies on the recently released Forbes Global 2000 list. This inclusion puts the Bellagio operator ahead of the likes of Colgate-Palmolive, Blackstone (who owns the Bellagio's real estate), and Southwest Airlines among others. In comparison to last year, MGM moved up by an impressive 147 spots, ranking significantly higher than rival Las Vegas Sands.
This prestigious list evaluates the largest companies in the world using four parameters: sales, profits, assets, and market value. A total of 58 countries are represented by the publicly-traded companies on the list. The United States holds the lead with 611 companies, while China comes in second with 346 Global 2000 companies.
MGM occupies the fifth position in the hotel, restaurant, and leisure category, while Las Vegas Sands places seventeenth. When evaluating the companies only by market capitalization, Sands is roughly double the size of the Cosmopolitan operator.
MGM's Turnaround Narrative
Following the initial phenomenon of COVID-19, many casino operators, including MGM, faced considerable penalty for extended shutdowns of their gaming venues in Las Vegas, Macau, and their multi-regional facilities.
However, through a series of transactions aimed at generating capital and under the supervision of CEO Bill Hornbuckle and CFO Jonathan Halkyard, MGM has undergone a transformation. The company now flaunts a more refined investment thesis and one of the strongest industry balances sheets.
In a note to clients, Deutsche Bank analyst Carlo Santarelli commented, "MGM's capital outlays over the medium to long-term pertaining to its development pipeline (NY / Japan) should not prevent it from continuing to repurchase shares for investors. The appealing current pricing is sufficient for the operator to keep its aggressive share repurchase program active." Santarelli currently maintains a "buy" rating on MGM shares with a price target of $58, suggesting a potential 40% increase from the June 8 close.
The Insignificant Gaming Industry on Forbes 2000
The gaming industry has little representation on the Forbes 2000 rankings. Following MGM, the next highest-ranked firm connected to the industry is VICI Properties, found in the 758th spot. It's noteworthy that VICI serves as MGM's main landlord and is the United States' largest owner of gaming real estate.
Macau concessionaires, Galaxy Entertainment and MGM were the only two gaming companies to join Sands and MGM on the list. However, Melco Resorts & Entertainment, SJM Holdings, and Wynn Resorts (NASDAQ: WYNN) didn't make the cut. Although, domestic casino operators like Caesars Entertainment (NASDAQ: CZR) made it at number 1,280.
Additionally, the gaming sector is represented by FanDuel parent Flutter Entertainment, advancing 239 spots to 1,077, and slot machine giant Aristocrat Leisure, escalating 33 positions from the 2022 rankings to 1,611.
The top 5 spots were dominated by JPMorgan Chase, Saudi Aramco, and three Chinese state-controlled banks.
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