Shares of casino giant MGM Resorts (MGM 2.14%) fell as much as 4.9% in trading on Thursday after the company reported fourth-quarter 2020 financial results. Shares recovered slightly late in the day but were still down 3.5% at 3:40 p.m. EST.
Total revenue was down 53% from a year ago to $1.49 billion, and MGM lost $448 million, or $0.90 per share on an adjusted basis. Analysts had been expecting revenue of $1.47 billion and a loss of $0.96 per share, so on that front results weren't too bad.
The business continues to improve from the depths of the pandemic in early summer. Las Vegas Strip resorts reported a 256% increase in EBITDA (a proxy for cash flow from resorts) in the quarter to $54 million, and MGM China's EBITDA was $41 million after a $96 million loss in the third quarter.
MGM's online betting company, BetMGM, reported 2020 revenue of $178 million, ahead of October 2020 guidance of $150 million to $160 million. And the company has a top-three market position in every market it serves.
It's not surprising that MGM lost money in the fourth quarter given the slow increase in travel and leisure spending in the U.S. and China. But there are growing signs that business will return to more normal levels sometime in 2021. And online sports betting continues to do well, so if BetMGM can remain a market leader, this could be a growth stock on the back on the expansion of U.S. online gambling.