Analysts split on BetMGM revenue forecast
A pair of stock analysts offered differing takes on BetMGM’s announcement that it was raising revenue and cash-flow guidance for 2025. Their views were expressed in competing 16 June investor notes.
BetMGM communicated that, for 2025, it now expects to deliver US$2.6 billion in revenue, up from US$2.4 billion. Stock analysts’ consensus had been bullish, closer to US$2.7 billion.
Revised cash flow for 2025 is now estimated at a positive return on investment of US$100 million. Jefferies Equity Research had previously pegged it at a mere US$6 million, while investors’ consensus was US$48 million.
BetMGM said it had seen 34% growth through the first quarter of 2025. Revenue through 13 June was reported to be consistent with that trend.
Jefferies Equity Research analyst James Wheatcroft said such an early upgrade “implies real confidence” in the outcome for fiscal year 2025. “The statement includes limited trading color, beyond the strength of net revenue growth, driven by handle growth,” he added.
Wheatcroft explained that the revision implied 12% earnings-per-share growth for co-parent Entain. BetMGM, he said, revoiced its confidence in near-term return on investment of US$500 million per year.
The Jefferies analyst noted that Entain’s stock valuation “appears to attach little value to Entain’s BetMGM stake.”
Professing himself unsurprised by BetMGM’s outperformance was Deutsche Bank analyst Carlo Santarelli. “While we don’t view the net revenue increase as overly surprising, given our forecast has been above the high end of the prior range, we believe the favorable EBITDA revision will be well received,” was his reaction.
Santarelli noted that his previous forecast for BetMGM had been just shy of US$2.6 billion, adding that MGM’s revision implied overall growth of 24%. He recorded that the increase was driven by handle growth, with BetMGM expecting continued such enlargement in the mid-teens for the remainder of 2025.
“While we don’t view the net revenue lift as overly surprising, we see the improvement in adjusted EBITDA guidance from “positive” to >$100 mm, for 2025, as favorable, especially when viewed through the lens of the robust flow through on the incremental net revenue in 2025,” Santarelli wrote. His own expectation for the 2025 return on investment had been US$35 million.
Formal BetMGM results will be released on 29 July.
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David McKee is an award-winning journalist who has three decades of experience covering the gaming industry.
