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Caesars Entertainment (CZR)
NASDAQ:CZR
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Caesars Entertainment
(NASDAQ:CZR)
46Neutral
Positive Factors
Board of Directors
The addition of two new independent directors from Icahn Enterprises to the Board of Caesars Entertainment is seen as incrementally positive for the shares.
IGaming Performance
In iGaming, the digital segment showed strong performance with gross gaming revenue up 48% year-over-year.
Shareholder Value
Caesars is considering options to unlock shareholder value, including monetizing the Digital business and selling non-core assets.
Negative Factors
Digital Segment Concerns
There is skepticism about the long-term growth of the digital segment, particularly in the sports betting area, which seems to be stalling.
Earnings Performance
Fourth quarter results showed revenue and EBITDA below expectations, primarily due to weaker performance in the Vegas and Digital segments.
Regional Competition
The company's regional portfolio has underperformed in almost every market due to persistent competition driven by increased supply.
Caesars Entertainment (CZR) vs. S&P 500 (SPY)
Market Cap
$4.91B
Dividend YieldN/A
Average Volume (3M)6.42M
Price to Earnings (P/E)―
Beta (1Y)1.81
Revenue Growth-2.45%
EPS Growth-135.17%
CountryUS
Employees50,000
SectorConsumer Cyclical
Sector Strength60
IndustryGambling, Resorts & Casinos
Share Statistics
EPS (TTM)-1.29
Shares Outstanding212,013,300
10 Day Avg. Volume6,456,317
30 Day Avg. Volume6,416,137
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.52
Price to Cash Flow (P/CF)4.70
P/FCF Ratio0.80
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$45.15Price Target Upside92.05% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering14
Caesars Entertainment Business Overview & Revenue Model
Company DescriptionCaesars Entertainment, Inc., headquartered in Las Vegas, Nevada, is one of the world's largest and most diversified gaming and entertainment companies. The company operates a portfolio of gaming facilities, hotels, and golf courses under the Caesars, Harrah's, Horseshoe, and Eldorado brand names, among others. Caesars Entertainment provides a wide range of services, including casino gaming, hospitality, entertainment, and dining, catering to a diverse customer base across the United States and internationally.
How the Company Makes MoneyCaesars Entertainment makes money primarily through its casino gaming operations, which include slot machines, table games, and sports betting. These activities are the largest contributors to its revenue. Additionally, Caesars generates income from hotel room bookings, food and beverage services, and entertainment events, such as concerts and shows held at its properties. The company also earns revenue from its loyalty program, Caesars Rewards, which encourages repeat visits and spending by offering customers points that can be redeemed for various services. Strategic partnerships, such as those with online gaming and sports betting platforms, further enhance its revenue streams by tapping into the growing digital market.
Caesars Entertainment Financial Statement Overview
Summary
Caesars Entertainment has shown revenue growth and operational efficiency. However, negative net income, high leverage, and challenges in generating free cash flow raise concerns about its financial stability.Income Statement
Caesars Entertainment has shown revenue growth over the past years, but the net profit margin is concerning with negative net income in recent periods. The company's EBIT margin is strong, showing operational efficiency, but negative EBITDA in the most recent year indicates challenges in maintaining profitability after accounting for non-cash expenses.55
Neutral
Balance Sheet
Caesars Entertainment has a high debt-to-equity ratio, indicating significant leverage which could pose risks in economic downturns. The company's equity ratio is low, signaling potential vulnerability. Positive return on equity shows that the company is generating returns on shareholders’ investments, despite its high leverage.45
Neutral
Cash Flow
The free cash flow has been negative, indicating potential issues in generating cash after capital expenditures. However, the operating cash flow remains positive, suggesting the company can cover its operational expenses. The free cash flow to net income ratio is unfavorable due to negative net income.40
Negative
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 11.24B | 11.53B | 10.82B | 9.57B | 3.47B | Gross Profit |
| 11.24B | 6.13B | 5.42B | 4.92B | 1.71B | EBIT |
| 2.30B | 2.47B | 1.74B | 1.46B | 222.00M | EBITDA |
| 3.58B | 3.56B | 3.07B | 2.83B | 193.00M | Net Income Common Stockholders |
| -278.00M | 786.00M | -524.00M | -986.00M | -1.76B |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 866.00M | 1.00B | 1.04B | 1.07B | 1.76B | Total Assets |
| 32.59B | 33.37B | 33.53B | 38.03B | 36.38B | Total Debt |
| 25.06B | 25.07B | 25.43B | 26.27B | 26.93B | Net Debt |
| 24.20B | 24.07B | 24.39B | 25.20B | 25.17B | Total Liabilities |
| 28.21B | 28.65B | 29.78B | 33.49B | 31.35B | Stockholders Equity |
| 4.38B | 4.55B | 3.71B | 4.48B | 5.02B |
| Cash Flow | Free Cash Flow | |||
| -221.00M | 515.00M | 12.00M | 340.00M | -769.00M | Operating Cash Flow |
| 1.07B | 1.81B | 975.00M | 1.17B | -571.00M | Investing Cash Flow |
| -704.00M | -1.26B | -382.00M | -2.92B | -6.18B | Financing Cash Flow |
| -498.00M | -713.00M | -1.28B | -550.00M | 10.64B |
Caesars Entertainment Technical Analysis
Negative
23.51
Price Trends
31.28
Negative
33.41
Negative
36.32
Negative
Market Momentum
-1.88
Positive
27.89
Positive
13.11
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CZR, the sentiment is Negative. The current price of 23.51 is below the 20-day moving average (MA) of 26.43, below the 50-day MA of 31.28, and below the 200-day MA of 36.32, indicating a bearish trend. The MACD of -1.88 indicates Positive momentum. The RSI at 27.89 is Positive, neither overbought nor oversold. The STOCH value of 13.11 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for CZR.
Caesars Entertainment Risk Analysis
Caesars Entertainment disclosed 31 risk factors in its most recent earnings report. Caesars Entertainment reported the most risks in the “Tech & Innovation” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Caesars Entertainment Peers Comparison
Overall Rating
UnderperformOutperform
Sector (59)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | $5.10B | 9.98 | 34.76% | 1.13% | 5.13% | 2.04% | |
74 Outperform | $2.94B | 8.52 | 8.08% | 5.50% | -22.16% | 123.24% | |
67 Neutral | $7.21B | 15.60 | -51.73% | 1.47% | 9.13% | -30.00% | |
66 Neutral | $7.60B | 11.00 | 21.76% | ― | 6.66% | -24.59% | |
60 Neutral | $3.99B | 14.86 | 80.25% | 2.66% | 12.47% | -14.15% | |
59 Neutral | $10.97B | 9.83 | -1.56% | 4.06% | 1.31% | -16.49% | |
46 Neutral | $4.91B | ― | -6.38% | ― | -2.45% | -135.17% |
* Consumer Cyclical Sector Average
Performance Comparison
CZR
Caesars Entertainment
23.51
-20.47
-46.54%
BYD
Boyd Gaming
60.80
-5.13
-7.78%
IGT
International Game Technology
14.44
-6.22
-30.11%
MGM
MGM Resorts
25.79
-20.62
-44.43%
WYNN
Wynn Resorts
66.10
-39.19
-37.22%
RRR
Red Rock Resorts
37.60
-23.04
-37.99%
Caesars Entertainment Earnings Call Summary
Earnings Call Date: Feb 25, 2025 | % Change Since: -32.58% | Next Earnings Date: Apr 29, 2025
Earnings Call Sentiment Positive
The earnings call highlighted strong overall financial performance for the year, with significant growth in the digital and Las Vegas segments. However, there were challenges in the regional segment and sports betting areas, with competitive pressures and specific incidents impacting results. The company showed progress in debt reduction and stock buybacks, indicating financial stability and strategic focus.Highlights
Strong Full Year Financial Results
Caesars Entertainment delivered consolidated same-store results of $11.2 billion in net revenues and $3.7 billion in EBITDA for 2024, with an EBITDA margin of 33.2%.
Las Vegas Performance
Las Vegas same store net revenues during Q4 were $1.1 billion, with adjusted EBITDA at $478 million. Despite a 1% decline versus last year, the results were strong given the tough comparison against the inaugural F1 race in 2023.
Digital Segment Growth
The digital segment achieved all-time records in net revenue, EBITDA, and cash flow in 2024. Net revenue was $1.2 billion, up 20% year-over-year, and adjusted EBITDA rose to $117 million from $38 million the previous year.
iGaming Success
iGaming showed exceptionally strong performance with 65% net revenue growth in Q4. The launch of new apps and branded studios are contributing factors.
Debt Reduction and Stock Buyback
Caesars Entertainment used asset sale proceeds to repay $500 million in debt and repurchase stock, acquiring 5.1 million shares at an average price of $37 per share.
Lowlights
Decline in Regional Segment
Q4 regional net revenues declined 1% and adjusted EBITDA declined 5%, driven by competitive pressures in certain markets.
Impact of Competitive Openings
The regional segment faced new competitive threats, impacting around $500 million of trailing EBITDA.
Sports Betting Revenue Decline
Q4 sports betting net revenue declined due to customer-friendly outcomes and overall volume decline.
Challenges in New Orleans
Performance in New Orleans was affected by a terrorist event and unusual weather, leading to a rollercoaster of results.
Company Guidance
In the 2024 Fourth Quarter and Full Year Earnings Conference Call for Caesars Entertainment, significant financial metrics and guidance for the future were discussed. For the full year, Caesars reported consolidated same-store net revenues of $11.2 billion and EBITDA of $3.7 billion, resulting in an EBITDA margin of 33.2%. In Las Vegas, the fourth-quarter same-store net revenues were $1.1 billion with an adjusted EBITDA of $478 million, showing a 1% decrease year-over-year. The occupancy rate was 96%, with group business representing 16% of occupied room nights. The regional segment saw a 1% decline in net revenues and a 5% decline in adjusted EBITDA. The company's digital segment achieved record results, with total net revenue of $1.2 billion, up 20% year-over-year, and adjusted EBITDA reaching $117 million. The iGaming segment grew by 65% in net revenue during the fourth quarter. For 2025, Caesars expects significant free cash flow growth, with continued improvements in both brick-and-mortar properties and digital segments, aiming for a $500 million EBITDA goal in digital by 2026.Caesars Entertainment Corporate Events
Executive/Board ChangesBusiness Operations and Strategy
Caesars Entertainment Enhances Board with Icahn Agreement
Positive
Mar 20, 2025
On March 17, 2025, Caesars Entertainment entered into an agreement with the Icahn Group, resulting in the appointment of Jesse Lynn and Ted Papapostolou as independent directors on its Board. This strategic move, effective immediately, aims to enhance shareholder value and explore strategic alternatives for Caesars’ digital business, while expanding the Board to 12 members. The agreement includes standstill and voting commitments from the Icahn Group, preventing them from acquiring significant ownership or engaging in proxy contests during the standstill period. This development reflects Caesars’ ongoing efforts to strengthen its governance and maximize shareholder value.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.