Caesars Entertainment Gears Up for Q4 Earnings Amid Mixed Analyst Sentiment
Caesars Entertainment, Inc. (CZR), with a market capitalization of $7.2 billion, operates in the gaming and hospitality sector. The company owns, leases, or manages properties across 18 states with offerings that include slot machines, video lottery terminals, e-tables, hotel rooms, and table games like poker. Based in Reno, Nevada, Caesars also runs retail and online sports betting platforms. Investors are keenly awaiting the release of the company’s fiscal Q4 earnings results, set to occur after the market closes on Thursday, February 25.
Analysts Predict Loss but Show Signs of Optimism
Before the earnings announcement, analysts anticipate a loss of $0.04 per share for Caesars, representing an 88.2% improvement from a loss of $0.34 per share reported in the same quarter last year. However, the company’s history of earnings surprises raises concerns, as it has consistently fallen short of Wall Street’s expectations over the last four quarters. Last quarter, CZR reported a loss of $0.04 per share, vastly missing a projected profit of $0.21 per share.
Future Projections Show Mixed Results
Looking ahead, analysts forecast that CZR might report a more significant loss of $0.58 in fiscal 2024, down a remarkable 163% from the $0.92 profit recorded in fiscal 2023. Nonetheless, there is optimism for fiscal 2025, with expectations of the company rebounding to a profit of $1.30, reflecting a significant 324.1% year-over-year growth.
Stock Performance Lags Behind Competitors
Over the last 52 weeks, CZR’s shares have dropped 23%, considerably trailing both the S&P 500 Index ($SPX), which rose by 26.5%, and the Consumer Discretionary Select Sector SPDR Fund (XLY), which saw a 33.1% return during the same period.
Recent Quarterly Earnings and Outlook
Following a disappointing Q3 earnings release on October 29, where CZR suffered an 8.2% drop in stock price, the company reported a loss of $0.04 per share compared to a profit of $0.34 per share in the previous year. That result missed analyst expectations significantly. Additionally, revenues fell 4% year-over-year to $2.9 billion, which was also below projections by 1.4%.
Factors contributing to this underperformance include weaker contributions from the Regional segment, new competitive pressures, construction issues, and challenging year-over-year comparisons. Declines in the Managed and Branded, as well as Las Vegas segments, added further challenges.
Analysts Maintain Moderate Optimism
Despite the recent challenges, Wall Street maintains a “Moderate Buy” rating on Caesars Entertainment stock. Among the 15 analysts monitoring the company, 11 recommend a “Strong Buy,” three advise to “Hold,” and just one suggests a “Strong Sell.” This shift marks a slight decrease in bullish sentiment compared to three months ago, when 12 analysts favored a “Strong Buy.”
The average price target for CZR stands at $50.43, suggesting a potential upside of 48.1% from current stock levels.
On the date of publication, Neharika Jain did not hold (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.
The views and opinions expressed herein are those of the author and do not necessarily reflect the views of Nasdaq, Inc.
