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Thread: Caesars Entertainment conquers Wall Street

  1. #1
    I have to say that I'm impressed. Shares of Caesars Entertainment, the world's second largest casino company (first is Las Vegas Sands) are now up almost 72% from its IPO price of a few weeks. That's a nice gain. Is Caesars Entertainment going to conquer Wall Street as the Emperors of old marched on cities and conquered them centuries ago. Or, will someone soon yell out "this emperor has no clothes!"

    We've all heard the dire warnings about Caesars' debt yet the stock marches like a triumphant army down Wall Street.

    What's up?

  2. #2
    Well, here we are three months later... and shares of CZR are now below the IPO price.

  3. #3
    The US stock market overall is being buoyed by a weak US dollar. There is a strong correlation between broad market indices and the movements of currency pairs such as EUR/USD and AUD/USD.

  4. #4
    Two days after my last post, my point is being clearly shown with the Fed's QE3 initiative. Markets way up, gold is up, US dollar getting crushed. Where the Dow is concerned, it's a bit like converting 10,000 units worth $1 each into 12,500 units worth 80 cents each (shown as a hypothetical).

  5. #5
    Shares of Caesars this past Friday closed $1.43 below its IPO price of $9. Most of the casino stocks continue to lag the overall market. Wynn is 24% below its stock price of a year earlier. IGT the leading slot machine maker is 11% below it's year ago level. Las Vegas Sands is 2% lower than a year ago. Not much "pay dirt" along Las Vegas Boulevard. But MGM is showing an 8% gain from a year earlier.

  6. #6
    As far as I understand it, Macau is the place to be for casino profits (has been for a number of years, but it's cooling off).

    More and more gamblers in the US are going to local casinos. It goes without saying this hurts LV and AC.

    You already know Harrah's (Caesars) had a crushing debt load when Apollo took it over some years ago...legacy costs of that still remain (servicing the debt).

    I remember in the depths of the financial crisis in '08-09 when LVS was $3 a share...if only I knew then what I know now, hah! Sheldon Adelson seemed like he was going broke quickly just a few short years ago.

  7. #7
    Like the Roman Empire, the conquest of Wall Street by Caesars (CZR) didn't last forever. Today, the stock closed at a new weekly low.

  8. #8
    Shares of CZR this past Friday closed at about half of the IPO price.

  9. #9
    Interesting news from CZR this past week. Bill's Gambling Hall will be closed and renovated and the refurbished hotel that will reopen will probably cater to a young and wealthy demographic.

    Caesars is no longer the house of high rollers -- or a casino company that is centered on gambling. Caesars Palace is no longer a high roller's palace but is more of a party hotel with its clubs and restaurants and bars -- and lower limit games.

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