5 Catalysts That Could Drive MGM Shares To $34

Shares of MGM Resorts International (NYSE: MGM) hit a new 52-week high of $28.30 on Tuesday, but analysts at Macquarie Research believe the stock could rise as high as $34.

Chad Beynon of Macquarie maintains an Outperform rating and $34 price target on MGM's stock following the company's third-quarter results, which came in above his expectations.

Beynon noted many companies in the consumer space are seeing softer demand, yet MGM's performance on the Las Vegas Strip suggests otherwise. Specifically, the company grew its revenue per available room (RevPAR) by 11 percent in the third quarter, which exceeded management's own guidance of 7 percent and the total Strip's 10 percent growth.

Beynon added that MGM also benefited in the quarter from several initiatives, including $78 million in cost savings, which helped spur a 26 percent growth in EBITDA. In fact, the company has already delivered on $350 million of the expected $400 million in cost savings targeted for next year.

5 Reasons To Be Bullish

Beynon also offered five reasons why MGM's stock has a further upside of more than 20 percent:

1. Room for additional sales and leasebacks to MGM Growth Properties LLC (NYSE: MGP).
2. Potential for legalization of gambling in Japan.
3. Expansion of its Profit Growth Plan (PGP) beyond $400 million.
4. Implementation of a PGP for Borgota.
5. MGM's RevPAR guidance for 2017 indicates a strong trend.

At last check, MGM Resorts was up 3.16 percent at $28.04.