MGM gains an edge with early smart table adoption: Citibank

MGM China has gained a technological advantage over its Macau competitors by being an early adopter of smart gaming tables, according to analysts at Citibank.

Citibank analysts George Choi and Ryan Cheung said, “by being an early adopter of smart gaming tables and becoming more aggressive in marketing, MGM China has been successful in gaining market share in 2023 and 2024 to date.”

The analysts added, “we believe the merits of smart gaming tables and RFID chips are real and, based on the estimated smart gaming table rollout timeline of its competitors, it looks like MGM China will enjoy this technological advantage over its competitors for most of 2024, if not extended into 2025.”

Based on MGM China’s sustained technological advantage, Citibank has named the company as its top pick in Macau and raised its target price on MGM China shares.

“We believe its technological advantage over its peers is sustainable throughout most of this year, thanks to its early adoption of smart gaming tables,” the analysts added.

Industry-wide, Citibank forecasted first quarter gross gaming revenue growth of 6% compared to a 2% increase in earnings, citing unfavorable hold percentages, especially in February. However, SJM is positioned to exceed growth targets as its Grand Lisboa Palace property becomes consistently profitable after ramping up operations late last year.

MGM China set an all-time quarterly earnings record in the fourth quarter of 2023, and Citibank expects the company, along with SJM, to continue outperforming peers through improved market position and adoption of gaming innovations.

Staff Reporter