Melco Resorts & Entertainment (NASDAQ:MLCO) Issues Earnings Results, Meets Expectations

Melco Resorts & Entertainment (NASDAQ:MLCO) issued its quarterly earnings data on Thursday. The company reported $0.06 earnings per share for the quarter, hitting analysts’ consensus estimates of $0.06, Briefing.com reports. Melco Resorts & Entertainment had a net margin of 4.33% and a negative return on equity of 32.60%. The business’s revenue was down 5.7% on a year-over-year basis. During the same period in the prior year, the company earned $0.04 earnings per share.

Here are the key takeaways from Melco Resorts & Entertainment’s conference call:

• Macau faced near-term pressure in Q2 from lower-than-expected visitation, World Cup-related substitution of gaming spend, and an unfavorable City of Dreams Macau VIP win rate of 2.7% versus 3.9% a year earlier. Group adjusted property EBITDA was approximately $304 million, or $312 million excluding VIP hold effects.
• Management said post-World Cup trends improved in late July and early August, with customers returning and playing volumes normalizing. Macau daily operating expenses remained controlled at roughly HKD 3.3–3.4 million, including House of Dancing Water, despite the upcoming REM ramp-up.
• REM has soft-opened and is scheduled for a grand opening after Golden Week in October; management views the differentiated luxury product, new gaming areas, and City of Dreams retail revamp as catalysts for visitation and customer engagement. However, retail construction is expected to disrupt the property through approximately June 2027.
• The company’s non-Macau portfolio continued to grow, with City of Dreams Manila EBITDA up 9% year over year to $31 million, Cyprus EBITDA up 60%, and Sri Lanka generating positive EBITDA of $3.5 million as its casino operations ramp.
• Melco reported approximately $2.8 billion of available liquidity and extended and upsized its revolving credit facility to $2.8 billion through June 2031, supporting financial flexibility. The company repurchased approximately 22.4 million ADSs during the quarter and now expects to recommence a substantive dividend in 2027, while the 2027 debt maturities remain under review.

Melco Resorts & Entertainment Stock Performance

Shares of NASDAQ MLCO traded down $0.01 during midday trading on Thursday, hitting $5.50. The company’s stock had a trading volume of 1,526,885 shares, compared to its average volume of 2,262,749. The firm has a market cap of $2.14 billion, a P/E ratio of 9.49, a P/E/G ratio of 3.47 and a beta of 0.59. Melco Resorts & Entertainment has a 1-year low of $5.07 and a 1-year high of $10.15. The firm’s fifty day moving average price is $5.48 and its 200-day moving average price is $5.65.

Analysts Set New Price Targets

A number of research firms have weighed in on MLCO. Wall Street Zen cut shares of Melco Resorts & Entertainment from a “buy” rating to a “hold” rating in a report on Sunday, June 28th. Morgan Stanley downgraded Melco Resorts & Entertainment from an “overweight” rating to a “negative” rating in a research report on Monday, June 22nd. JPMorgan Chase & Co. decreased their price target on shares of Melco Resorts & Entertainment from $6.00 to $5.70 and set a “neutral” rating on the stock in a report on Thursday, July 16th. CLSA upgraded shares of Melco Resorts & Entertainment from a “hold” rating to an “outperform” rating and cut their price target for the company from $6.10 to $6.00 in a report on Friday, July 10th. Finally, CICC Research raised shares of Melco Resorts & Entertainment to an “outperform” rating in a research note on Sunday, April 19th. One investment analyst has rated the stock with a Strong Buy rating, five have given a Buy rating, two have given a Hold rating and two have assigned a Sell rating to the company. Based on data from MarketBeat, Melco Resorts & Entertainment presently has an average rating of “Moderate Buy” and an average target price of $7.43.

Hedge Funds Weigh In On Melco Resorts & Entertainment

Institutional investors and hedge funds have recently added to or reduced their stakes in the business. Royal Bank of Canada lifted its stake in shares of Melco Resorts & Entertainment by 11.1% in the 1st quarter. Royal Bank of Canada now owns 180,161 shares of the company’s stock worth $949,000 after acquiring an additional 18,010 shares during the period. Millennium Management LLC grew its position in Melco Resorts & Entertainment by 69.3% during the first quarter. Millennium Management LLC now owns 1,915,978 shares of the company’s stock worth $10,097,000 after buying an additional 784,403 shares in the last quarter. Goldman Sachs Group Inc. lifted its position in shares of Melco Resorts & Entertainment by 16.4% during the 1st quarter. Goldman Sachs Group Inc. now owns 6,015,200 shares of the company’s stock worth $31,700,000 after buying an additional 846,504 shares during the period. Geode Capital Management LLC grew its stake in Melco Resorts & Entertainment by 5.8% during the second quarter. Geode Capital Management LLC now owns 369,491 shares of the company’s stock worth $2,669,000 after buying an additional 20,165 shares during the last quarter. Finally, Creative Planning increased its holdings in shares of Melco Resorts & Entertainment by 67.4% in the second quarter. Creative Planning now owns 17,981 shares of the company’s stock valued at $130,000 after purchasing an additional 7,239 shares in the last quarter. 39.62% of the stock is owned by institutional investors.

About Melco Resorts & Entertainment

Melco Resorts & Entertainment Limited (NASDAQ: MLCO) is a developer, owner and operator of integrated resort destinations in Asia and Europe. The company’s portfolio spans casino gaming, hotel accommodations, retail, dining and entertainment facilities. Melco’s properties feature a mix of luxury hotels, award-winning restaurants, high-limit gaming salons and entertainment venues, catering to a broad range of leisure and business travelers.

In Macau, Melco owns and operates flagship properties including City of Dreams Macau, Altira Macau and Studio City.