Market Begins to Favor MGM Resorts International (MGM) Due to Continued Strong Performance

Longleaf Partners, managed by Southeastern Asset Management, released its “Partners Fund” second quarter 2025 investor letter. A copy of the letter can be downloaded here. The fund returned 5.33% in the second quarter, compared to the S&P 500’s 10.94% return and Russell 1000 Value’s 3.79% return. The firm’s stock price performance was volatile, but its confidence in future returns grew as the quarter progressed. Since markets have recovered and portfolio holdings remain high-quality and discounted, the firm believes maintaining its current cautious stance, as reflected in the recent strong results during turbulent times, is prudent, despite not fully matching recent market highs. For more information on the fund’s best picks in 2025, please check its top five holdings.

In its second quarter 2025 investor letter, Longleaf Partners Fund highlighted stocks such as MGM Resorts International (NYSE:MGM). MGM Resorts International (NYSE:MGM) is a gaming and entertainment company that owns and operates casino, hotel, and entertainment resorts. The one-month return of MGM Resorts International (NYSE:MGM) was 13.44%, and its shares lost 7.50% of their value over the last 52 weeks. On July 23, 2025, MGM Resorts International (NYSE:MGM) stock closed at $38.33 per share, with a market capitalization of $10.431 billion.

Longleaf Partners Fund stated the following regarding MGM Resorts International (NYSE:MGM) in its second quarter 2025 investor letter:

"MGM Resorts International (NYSE:MGM) – Hospitality and gaming company MGM Resorts was a contributor. The company continues to report strong quarterly results. This was recognized by the market this quarter, compared to other quarters when results went unappreciated. MGM is also one of our larger share repurchasers in the portfolio, with further simplification and value realization anticipated. We are confident that recession fears are overstated by the market as it overweights the anomaly of the 2008 financial crisis, especially considering MGM is in a better financial position today."

MGM Resorts International (NYSE:MGM) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 52 hedge fund portfolios held MGM Resorts International (NYSE:MGM) at the end of the first quarter, which was 47 in the previous quarter. While we acknowledge the potential of MGM Resorts International (NYSE:MGM) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

In another article, we covered MGM Resorts International (NYSE:MGM) and shared the list of best S&P 500 stocks with huge upside potential. In addition, please check out our hedge fund investor letters Q2 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.