Earnings

Are MGM Resorts International (MGM)’s Recent Ownership and Insider Trends a Sign of Things to Come?

Recent insider trends for MGM Resorts International (NYSE:MGM) have caught the attention of investors. Analysts monitor insider data to understand the sentiment of a company’s largest and most important shareholders. MGM’s insider trading patterns have some implications for where the stock might be headed.

Institutions own 76.43% of MGM Resorts International (MGM)’s shares. The total value of these holdings, in millions, is $14,618. Among active positions in the latest quarter, 216 holders increased their positions by a total of 76.18 million shares, 224 holders decreased the positions by a total of 60.77 million shares, and 50 holders held their positions. This works out to a net increase in ownership of 15.41 million shares, and suggests that institutions are feeling bullish about the stock.

Among new and sold out positions, 68 holders initiated new positions by a total of 45.89 million shares and 61 holders exited their positions by a total of 15.02 million shares. This nets out to an increase of 30.87 million shares and is a bullish sign for MGM.

In the last three months, insiders executed a total of 16 trades. 0 of these were buys and 16 were sells. Insider ownership decreased by a total of 786168 shares, which suggests that MGM’s key executives are feeling less optimistic about the outlook for the stock. The data from the past twelve months tells a different story: insiders executed 13 buys and 99 sells, and ownership increased by a net of 27.3 million shares.



The analysis of insider buying and selling trends can be extended to the aggregate level. Short interest, which represents the number of a stock’s shares currently being shorted, captures what the market as a whole feels about a stock. MGM Resorts International (NYSE:MGM)’s short interest is 27.39 million shares, or 5.42% of the float. This represents an increase of 2% in the number of shares being shorted compared to the previous reading, and implies that investors felt more pessimistic about the stock during the past two weeks.

Insider data can help an investor form an outlook on a stock, but it’s important to supplement this data with other information such as technical indicators to form a more complete view. A composite of 13 technical indicators that includes measures such as moving averages and momentum oscillators suggests that MGM is a buy, which implies that MGM is expected to outperform the market based on prior trading patterns.

Conclusion




Institutional ownership trends suggest that the stock is cheap and the insider trading data indicates that insiders are bearish. Technical indicators (also) suggest that MGM Resorts International (NYSE:MGM) is undervalued.

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