{"id":216930,"date":"2022-06-12T16:57:36","date_gmt":"2022-06-12T23:57:36","guid":{"rendered":"https:\/\/www.casino.org\/news\/?p=216930"},"modified":"2022-06-12T17:29:30","modified_gmt":"2022-06-13T00:29:30","slug":"caesars-stocks-looks-appealing-following-big-slump","status":"publish","type":"post","link":"https:\/\/www.casino.org\/news\/caesars-stocks-looks-appealing-following-big-slump\/","title":{"rendered":"Caesars Deleveraging Story Poised for Dramatic Acceleration, Says Analyst"},"content":{"rendered":"

Caesars Entertainment\u2019s (NASDAQ:CZR) debt burden stood at $13.5 billion at the end of March — among the highest in the gaming industry — but one analyst sees the company\u2019s debt-reduction efforts potential accelerating over the near-term.<\/p>\n

\"Caesars\"
Caesars Palace on the Las Vegas Strip. An analyst sees lots of reasons to like the stock. (Image: CNN<\/em>)<\/figcaption><\/figure>\n

In a recent note to clients, Stifel analyst Steven Wieczynski said, \u201cThe potential expected sale of a Las Vegas Strip asset should dramatically accelerate an already considerable organic deleveraging story.\u201d<\/p>\n

Dating back to last year, Caesars management said it expected to unveil the sale of one of its Strip venues early in 2022. Since then, the only debates centered around when the operator would formally announce an asset sale<\/a> and which Las Vegas venue it would be.<\/p>\n

\n

Nearly halfway through the year, that announcement hasn\u2019t arrived. Last month, reports surfaced the operator is shopping the Flamingo<\/a> at a price tag of roughly $1 billion. There\u2019s speculation that Caesars may have difficulty unloading that property because it needs enhancements, and business there might decline if it\u2019s no longer part of the Caesars Rewards program.<\/p>\n<\/div>\n

Conversely, owing to comparisons on other recent Strip property sales, it\u2019s possible Caesars could command a high teens multiple when it decides to part ways with one of its Sin City venues.<\/p>\n

Caesars Management Sounds Optimistic Tone<\/h2>\n

Wieczynski recently met with Caesars CEO Tom Reeg and other high-ranking executives. He notes they\u2019re bullish on Strip and regional casinos, and that investors may be overlooking the company\u2019s free cash flow (FCF)-generating potential.<\/p>\n

We believe the market continues to discount the \u2018post-COVID\u2019 FCF potential of CZR\u2019s brick & mortar business, management\u2019s iGaming\/OSB opportunity (not even priced into shares anymore), the Omni-channel marketing potential embedded in Total Rewards, and potential for asset sales,\u201d<\/strong> says the analyst.<\/p><\/blockquote>\n

Still, as is the case with other gaming equities, Caesars is slumping this year<\/a>. The shares are off 51.35% year-to-date due to culprits such as inflation and margin concerns. On the bright side, it\u2019s possible that margin concerns are exaggerated and Caesars may have some momentum on that front.<\/p>\n

\u201cManagement firmly sees these concerns as overblown, highlighting that (1) the current trend in the savings rate could imply tailwinds to the consumer through 2023 and (2) their overall cost structure is predominately \u2018right-sized\u2019 by this point with any modest pockets of cost inflation likely offset by the return of the high margin group customer,\u201d adds Wieczynski.<\/p>\n

Caesars Risk\/Reward too Attractive to Ignore<\/h2>\n

With Caesars stock off 62% from its 52-week high, and issues such as inflation, soaring gas prices, and rising interest rates factored into the share price, risk\/reward may be skewing more towards \u201creward.\u201d<\/p>\n

\u201cWe believe shares have corrected to the point where investors need to revisit this story. Vegas and Regional trends continue to outpace expectations, and it seems like trends have only gotten better through May,\u201d concludes Wieczynski.<\/p>\n

He rates Caesars a \u201cbuy\u201d with a $113 price target, implying it can more than double from the June 10 close of $45.50.<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

Caesars Entertainment\u2019s (NASDAQ:CZR) debt burden stood at $13.5 billion at the end of March — among the highest in the gaming industry — but one analyst sees the company\u2019s debt-reduction efforts potential accelerating over the near-term. In a recent note to clients, Stifel analyst Steven Wieczynski said, \u201cThe potential expected sale of a Las Vegas […]<\/p>\n","protected":false},"author":46,"featured_media":216931,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[62,10],"tags":[],"acf":[],"yoast_head":"\nCaesars Stocks Looks Appealing Following Big Slump<\/title>\n<meta name=\"description\" content=\"Caesars stock could have more tailwinds than meet the eye, says an analyst.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.casino.org\/news\/caesars-stocks-looks-appealing-following-big-slump\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Caesars Stocks Looks Appealing Following Big Slump\" \/>\n<meta property=\"og:description\" content=\"Caesars stock could have more tailwinds than meet the eye, says an analyst.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.casino.org\/news\/caesars-stocks-looks-appealing-following-big-slump\/\" \/>\n<meta property=\"og:site_name\" content=\"Casino.org\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/Casino.OrgNews\" \/>\n<meta property=\"article:published_time\" content=\"2022-06-12T23:57:36+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2022-06-13T00:29:30+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/06\/CP2-scaled.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"2560\" \/>\n\t<meta property=\"og:image:height\" content=\"1660\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Todd Shriber\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@etfgodfather\" \/>\n<meta name=\"twitter:site\" content=\"@Casino_Org\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Todd Shriber\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"3 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.casino.org\/news\/caesars-stocks-looks-appealing-following-big-slump\/\",\"url\":\"https:\/\/www.casino.org\/news\/caesars-stocks-looks-appealing-following-big-slump\/\",\"name\":\"Caesars Stocks Looks Appealing Following Big Slump\",\"isPartOf\":{\"@id\":\"https:\/\/www.casino.org\/news\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/www.casino.org\/news\/caesars-stocks-looks-appealing-following-big-slump\/#primaryimage\"},\"image\":{\"@id\":\"https:\/\/www.casino.org\/news\/caesars-stocks-looks-appealing-following-big-slump\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/06\/CP2-scaled.jpg\",\"datePublished\":\"2022-06-12T23:57:36+00:00\",\"dateModified\":\"2022-06-13T00:29:30+00:00\",\"author\":{\"@id\":\"https:\/\/www.casino.org\/news\/#\/schema\/person\/f4cecf70a5032bc4e60eb73fc86d4a85\"},\"description\":\"Caesars stock could have more tailwinds than meet the eye, says an analyst.\",\"breadcrumb\":{\"@id\":\"https:\/\/www.casino.org\/news\/caesars-stocks-looks-appealing-following-big-slump\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/www.casino.org\/news\/caesars-stocks-looks-appealing-following-big-slump\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/www.casino.org\/news\/caesars-stocks-looks-appealing-following-big-slump\/#primaryimage\",\"url\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/06\/CP2-scaled.jpg\",\"contentUrl\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/06\/CP2-scaled.jpg\",\"width\":2560,\"height\":1660,\"caption\":\"Caesars Palace on the Las Vegas Strip. 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