The opening in the Macau city of Cotai is set to boost EBITDA for MGM China.
China.- Morgan Stanley analysts said in a Tuesday note that MGM China Holdings is likely to experience the highest growth in EBITDA (earnings before interest, taxation, depreciation and amortisation) among Macau’s licensees.
The banking entity said that the opening of the MGM Cotai casino would certainly boost the company’s operations and would also help outperform the market in 2019. The opening of the latest facility in Macau is scheduled for January 29, a few days after the Chinese New Year, which usually helps with finances.
Praveen Choudhary, Alex Poon and Thomas Allen, analysts for Morgan Stanley, said: “Short interest on MGM China is high (18 percent of free float) as the market is anticipating near-term market share loss, slow ramp of Cotai, weaker VIP business and cannibalisation.”
They also added that MGM China could experience an 80-percent EBITDA growth between 2017 and 2019, implying 35 percent compound annual growth over 2017 to 2019, much stronger than peers, of 11 percent.