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Reno, Nevada-based Caesars Entertainment, Inc. (CZR) owns and operates as a gaming and hospitality company. Valued at $7.57 billion by market cap, the company offers casino, poker, roulette, and other gaming facilities and provides food and beverage services. The company owns, leases, or manages domestic properties in 18 states and utilizes its hotels, restaurants, bars, entertainment, racing, sportsbook offerings, retail shops, and other services to attract customers to its properties.
Shares of this casino entertainment company have underperformed the broader market considerably over the past year. CZR has declined 35.8% over this time frame, while the broader S&P 500 Index ($SPX) has rallied nearly 17.3%. In 2024, CZR stock is down 22.5%, while the SPX is up 10.7% on a YTD basis.
Narrowing the focus, CZR’s underperformance is also apparent compared to the Consumer Disc ETF Vanguard (VCR). The exchange-traded fund has gained marginally over the past year. The ETF’s 3.3% losses on a YTD basis outshine the stock’s double-digit losses over the same time frame.
On Aug. 5, CZR shares fell more than 8% as recession concerns affected investors’ outlook on travel and casino stocks.
On Jul. 30, CZR shares closed up more than 1% after reporting its Q2 results. Its loss per share was $0.56. The company’s revenue was $2.83 billion, missing Wall Street forecasts of $2.86 billion. Its same-store adjusted EBITDA stood at $1 billion. Its Caesars Digital adjusted EBITDA stood at $40 million, up 263.6% year over year. The company remains optimistic for the rest of 2024, driven by solid operating trends in the Las Vegas and Caesars Digital segments, as well as the upcoming opening of the Danville facility and a $430-million investment in the newly rebranded Caesars New Orleans property.
For the current fiscal year, ending in December, analysts expect CZR’s EPS to decline 93.5% to $0.06 on a diluted basis. The company’s earnings surprise history is disappointing. It missed the consensus estimate in three of the last four quarters while beating the forecast on another occasion.
Among the 16 analysts covering CZR stock, the consensus rating is a “Moderate Buy.” That’s based on 12 “Strong Buy” ratings, three “Holds,” and one “Strong Sell.”
This configuration is more bullish than three months ago, with 10 suggesting a “Strong Buy.”
Recently, Macquarie analyst Chad Beynon kept an “Outperform” rating on CZR stock but lowered the price target from $55 to $52, implying a potential upside of 48.7% from current levels.
The mean price target of $53.19 represents a 52.1% premium to CZR’s current price levels. The Street-high price target of $70 suggests an ambitious upside potential of 100.1%.
On the date of publication, Neha Panjwani did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
