Shares of hospitality and casino entertainment company MGM Resorts (NYSE:MGM) jumped 2.6% in the morning session after its proposal to obtain a full downstate casino license in New York received a key preliminary approval.

The company’s plan to expand its MGM Empire City racino in Yonkers moved to the next stage after receiving unanimous support from its Community Advisory Committee. This approval was a critical step, allowing the proposal to advance for evaluation by the state's Gaming Facility Location Board, which will make the final decision. If fully approved, the license would permit MGM to transform its current video gaming facility into a full-scale resort with live table games. The proposed $2.3 billion expansion included plans for a renovated gaming floor, new restaurants, and an entertainment venue, signaling a major development for the company's presence in the region.

After the initial pop the shares cooled down to $35.45, up 2.8% from previous close.

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MGM Resorts’s shares are somewhat volatile and have had 10 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.

The previous big move we wrote about was 4 days ago when the stock dropped 3.2% on the news that analysts lowered their price targets, citing concerns about weaker-than-expected growth in Las Vegas.

Specifically, Mizuho trimmed its price target to $56 from $58, pointing to a slowdown in the company's Las Vegas operations. The firm noted that hotel revenue was not as strong as hoped, driven by a key metric called RevPAR, or Revenue Per Available Room, which fell more than expected. This led Mizuho to lower its earnings forecast for MGM's Las Vegas business. Adding to the cautious sentiment, Deutsche Bank also slightly reduced its price target on the stock to $53 from $54. While stronger results from Macau helped to soften the blow from the Vegas weakness, the analyst actions signaled growing concerns about the company's performance in its core market.

MGM Resorts is up 5.3% since the beginning of the year, but at $35.45 per share, it is still trading 15.6% below its 52-week high of $41.99 from October 2024. Investors who bought $1,000 worth of MGM Resorts’s shares 5 years ago would now be looking at an investment worth $1,567.

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