What happened
MGM Resorts International (MGM -1.24%) was higher on Wednesday, up 1.1% at the closing bell. The stock price had dropped 2.3% at 10:45 a.m. ET, but surged higher in the afternoon, up 1.9% at 3:37 p.m. ET. The share price has fallen about 31% year to date.
Overall, the market was down slightly on Wednesday as the Dow fell 0.1%, the S&P 500 was off 0.3%, and Nasdaq was down 0.1%.
So what
MGM Resorts made some news Wednesday that likely jolted its stock price upward. The company announced that it was remodeling its 2.1-million-square-foot convention center at Mandalay Bay Resort in Las Vegas.
The $100 million renovation to one of the country's leading convention and trade show spaces will include a new design complementing its tropical theme; technology upgrades; digital signage and digital walls; and redesigned rooms, ballrooms, and function spaces, among other changes. The renovations are based on feedback from meeting planners to create a modern space that meets the needs of contemporary convention audiences.
The convention center will remain fully operational during the remodel, which is expected to be complete in 2024.
Now what
This project comes at a time when Mandalay Bay is starting to see its convention business rebound from the pandemic. In the second quarter, room nights tied to conventions were at 93% of pre-COVID 2019 levels. Also, casino revenue was up 41% in Las Vegas in the second quarter, while room revenue jumped 133% year over year, and rates climbed 51%.
With the company expecting year over year growth in conventions in 2023, including some citywide shows that haven't been back since the pandemic, it should spur more hotel and casino revenue next year.
With conventions rebounding and Las Vegas remaining in high demand, MGM should have some momentum heading into 2023. It also has a low 4.4 price-to-earnings ratio. Keep an eye out for its third quarter earnings report, which comes out on Nov. 2, for more visibility heading into 2023.
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