Caesars Entertainment, Inc. CZR is expected to report third quarter 2023 results on October 31, 2023 after the market close.
In the most recently reported quarter, the company’s earnings and revenue exceeded the Zacks Consensus Estimate by 148.5% and 0.6%, respectively. Profit and revenue increased by 412.5% and 2.1%, respectively, compared to the same quarter last year.
Notably, CZR beat earnings estimates in each of the last four quarters, with the average surprise being 74.3%.
The trend in estimate revision
For the quarter to be reported, the Zacks Consensus Estimate for earnings per share has risen from 24 cents to 27 cents over the past 30 days. The estimated figure suggests a 12.5% improvement from 24 cents in the year-ago quarter.
Caesars Entertainment, Inc. Price and EPS Surprise
Caesars Entertainment, Inc. Price EPS Surprise | Quote from Caesars Entertainment, Inc
The consensus revenue estimate is $2.91 billion, up 0.9% from the reported figure for the prior-year quarter.
Factors to consider
Caesars Entertainment’s third-quarter revenue is expected to have increased year-over-year due to pent-up demand, expanding sports betting retail and real estate development initiatives. Strong group and convention business, improved marketing capabilities and emphasis on strategic expansion into new markets are also likely to have supported the company’s performance in the quarter.
According to our model, total revenue in Las Vegas is expected to increase 6.6% year-over-year to $1,148.5 million in the third quarter. We expect managed and branded revenue to increase 11.2% year-over-year to $77.8 million in the quarter. However, we expect regional revenue to decline 0.9% year-over-year to $1,516.7 million.
Meanwhile, increased investments in the digital business and increased operating costs are likely to have impacted the company’s earnings in the quarter under review. Inflationary pressures, particularly in food and beverages as well as hotel costs and interest rate increases, are putting additional pressure on CZR’s profitability. Our model expects total operating expenses to increase 1.3% year-over-year to $2,257.3 million in the third quarter.
What the Zacks Model Reveals
Our proven model predicts an increase in earnings for Caesars Entertainment this time. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy), or 3 (Hold) increases the likelihood of an earnings beat. That is exactly the case here.
Use our Earnings ESP filter to discover the best stocks to buy or sell before they’re reported.
Caesars Entertainment has an ESP of +10.35% and is ranked #2 on Zacks.
Other stocks with the favorable combination
Here are some other Zacks Consumer Discretionary stocks that investors could consider, as our model shows that they too have the right combination of elements to deliver an earnings beat this time around.
MGM Resorts International MGM has an Earnings ESP of +3.03% and a Zacks Rank #2. You can see You can see the complete list of today’s Zacks #1 Rank stocks here.
Shares of MGM Resorts are up 0.3% over the past year. MGM’s earnings beat consensus in three of the four quarters and missed once, with an average surprise of 105.7%.
Marriott International, Inc. MAR has an Earnings ESP of +1.72% and a Zacks Rank #3.
Shares of Marriott have risen 20.6% over the past year. MAR’s earnings beat consensus in each of the last four quarters, with an average surprise of 5.5%.
Hilton Worldwide Holdings Inc. HLT has an Earnings ESP of +1.45% and a Zacks Rank #2.
Shares of Hilton are up 13% over the past year. HLT’s earnings beat consensus three times and missed once over the last four quarters, with the average surprise being 11.3%.
Stay on top of upcoming earnings releases with the Zacks Earnings Calendar.
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