Shareholders might have noticed that Caesars Entertainment, Inc. (NASDAQ:CZR) filed its quarterly result this time last week. The early response was not positive, with shares down 9.3% to US$40.05 in the past week. Revenues came in at US$2.9b, in line with estimates, while Caesars Entertainment reported a statutory loss of US$0.04 per share, well short of prior analyst forecasts for a profit. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.
Taking into account the latest results, the most recent consensus for Caesars Entertainment from 16 analysts is for revenues of US$11.8b in 2025. If met, it would imply a reasonable 4.8% increase on its revenue over the past 12 months. Earnings are expected to improve, with Caesars Entertainment forecast to report a statutory profit of US$1.41 per share. In the lead-up to this report, the analysts had been modelling revenues of US$11.9b and earnings per share (EPS) of US$1.53 in 2025. The analysts seem to have become a little more negative on the business after the latest results, given the small dip in their earnings per share numbers for next year.
The consensus price target held steady at US$53.32, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. The most optimistic Caesars Entertainment analyst has a price target of US$66.00 per share, while the most pessimistic values it at US$35.00. This shows there is still a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.
Of course, another way to look at these forecasts is to place them into context against the industry itself. It's pretty clear that there is an expectation that Caesars Entertainment's revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 3.8% growth on an annualised basis. This is compared to a historical growth rate of 29% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 9.5% per year. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Caesars Entertainment.
The Bottom Line
The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. The consensus price target held steady at US$53.32, with the latest estimates not enough to have an impact on their price targets.
With that in mind, we wouldn't be too quick to come to a conclusion on Caesars Entertainment. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Caesars Entertainment analysts - going out to 2026, and you can see them free on our platform here.
You can also see whether Caesars Entertainment is carrying too much debt, and whether its balance sheet is healthy, for free on our platform here.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
