Chris Davis Adds $4.35 Million to MGM Resorts

Davis Selected Advisers, led by renowned investor Chris Davis, increased its exposure to MGM Resorts International by purchasing 140,037 shares on September 30, 2026, at an average price of $31.05 per share. The transaction was worth approximately $4.35 million.

Following the purchase, Davis Selected Advisers held 24.04 million shares, equivalent to approximately 9.6% of MGM’s outstanding shares and 3.2% of the fund’s reported portfolio. This was an incremental addition to an existing position, signalling continued interest rather than a fresh investment.

Why could Davis be adding to MGM?

The purchase price suggests a potential value-investing angle. MGM shares had come under pressure amid softer Las Vegas operating performance and uncertainty following the withdrawal of Barry Diller’s People Inc. proposal to acquire the remaining public shares at $48.30 per share. Davis’s investment philosophy centres on acquiring established businesses when valuations become attractive.

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Davis has not publicly stated its specific rationale for this trade, MGM’s global resort portfolio, recovery potential in Las Vegas, growing digital gaming business and long-term expansion in Japan offer possible attractions for a patient investor.

Fundamentals: A mixed operating picture

MGM reported Q3 2026 revenue of $4.21 billion, down 1% year-on-year. Consolidated

Adjusted EBITDA declined to $403 million from $506 million a year earlier. Las Vegas Strip revenue fell 2%, with room rates and RevPAR both down 8%. However, MGM China delivered 5% revenue growth and achieved a record quarterly market share of 17.1%. Its digital business also grew revenue by 6%. BetMGM’s North American venture reported a 112% increase in Adjusted EBITDA to $86 million, providing another potential growth driver.

Looking ahead, the company’s proposed MGM Osaka integrated resort in Japan, targeted for a 2030 opening, represents a significant long-term expansion opportunity. Management also reported a favourable improvement in Las Vegas trading during October. These growth drivers need to be weighed against MGM’s substantial lease commitments, debt burden and sensitivity to discretionary consumer spending.

Technical view and valuation

At the November 11, 2026 snapshot, MGM was trading around $33.06, approximately 6.5% above Davis’s reported purchase price. Its 14-day RSI stood at 60.5, while the shorter-term five-day RSI was elevated at 79.7, suggesting a recent recovery that may be approaching overbought territory in the near term. Intermediate-term momentum remained mixed.

GuruFocus estimated fair value at $44.42, indicating a valuation discount of roughly 26%; this is a third-party model estimate, not a guaranteed price target.

SmartMoneyExpress Take: Davis’s additional purchase is a notable institutional ownership signal, particularly given the fund’s existing 9.6% stake. MGM offers exposure to global tourism, gaming, digital betting and the emerging Japanese integrated-resort market.

However, the latest earnings show that operational recovery is not yet uniform. The key indicators to watch are Las Vegas room-rate recovery, Macau market share, BetMGM profitability and progress on Osaka. The opportunity rests on whether these growth engines can translate into stronger cash generation and justify a higher valuation.

This article is for information and research purposes only and does not constitute investment advice or a recommendation to buy or sell MGM shares.

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