{"id":318845,"date":"2024-05-01T14:51:29","date_gmt":"2024-05-01T19:51:29","guid":{"rendered":"https:\/\/www.casino.org\/news\/?p=318845"},"modified":"2024-05-08T22:27:13","modified_gmt":"2024-05-09T03:27:13","slug":"caesars-could-sell-non-core-gaming-assets-says-ceo-reeg","status":"publish","type":"post","link":"https:\/\/www.casino.org\/news\/caesars-could-sell-non-core-gaming-assets-says-ceo-reeg\/","title":{"rendered":"Caesars Open to Selling \u2018Non-Core\u2019 Casinos to Reduce Debt"},"content":{"rendered":"

Shares of Caesars Entertainment (NASDAQ: CZR) rebound Wednesday from a post-earnings report slide late Tuesday and the gaming company\u2019s reiterated commitment to reducing debt could be one reason behind today\u2019s bounce back by the stock.<\/p>\n

\"caesars\"
Caesars CEO Tom Reeg in a 2021 CNBC<\/em> interview. He said the company is open to parting with “non-core” assets. (Image: CNBC<\/em>)<\/figcaption><\/figure>\n

Caesars has been using excess free cash flow to pare liabilities and improving earnings before interest, taxes, depreciation, and amortization (EBITDA) serves the aim of reducing leverage ratios, but there are other avenues through which any company can trim debt. Those include asset sales — something CEO Tom Reeg appears open to.<\/p>\n

We have a number of assets that produce very little or no cash flow that are non-core to the business, non-operating casinos that could potentially be monetized at attractive rates where you wouldn\u2019t have to change your model much,\u201d said Reeg in response to question from JPMorgan analyst Joseph Greff on Caesars\u2019 earnings conference call late Tuesday. \u201cAnd without getting too forward-looking, you shouldn\u2019t be surprised if some of those types of things start to happen in 2024 that our leverage reduction is not limited to only free cash flow.\u201d<\/p><\/blockquote>\n

As of March 31, the Harrah\u2019s operator had $12.436 billion<\/a> in outstanding liabilities compared to $12.439 billion at the end of 2023. When the first quarter drew to a close, Caesars had $726 million in cash on hand not including $139 million in restricted cash.<\/p>\n

Reeg Mum on What Casinos Caesars Could Sell<\/h2>\n

In what could be an encouraging sign for the gaming industry and investment bankers alike, Reeg\u2019s comments about the possibility of Caesars potentially divesting non-core assets this year arrived against the backdrop of some market observers expressing concern that the Federal Reserve delaying interest rate cuts could be a headwind<\/a> to 2024 consolidation activity.<\/p>\n

Likewise, the Caesars chief executive officer didn\u2019t identify what gaming venues the company considers \u201cnon-core.\u201d The Nevada-based gaming giant operates more than 50 casino<\/a> hotels, including properties managed in partnership with Tribes, in 17 states and Canada.<\/strong><\/p>\n

\n

In 2022, Caesars was rumored to be actively shopping the Flamingo on the Las Vegas<\/a>, but a transaction didn\u2019t materialize and the operator eschewed trying to unload the venue last year. Selling a Strip property would likely create a large windfall Caesars\u2019 debt-reduction plans, but Reeg didn\u2019t say that\u2019s something the operator is examining such a move.<\/p>\n<\/div>\n

On the other hand, data support the notion that there\u2019s increasing softness in some regional gaming markets due to retreating consumer spending. That could provide a solid reason for operators to potentially part with regional casinos, but macroeconomic headwinds are also likely to adversely affect the prices sellers fetch.<\/p>\n

Analysts Chill on Caesars Following Earnings<\/h2>\n

In the first quarter, Caesars missed Wall Street earnings and revenue forecasts, prompting some reduced sell-side enthusiasm on the stock. Today, at least six analysts trimmed price targets on the Horseshoe operator.<\/p>\n

One of those was Macquarie analyst Chad Beynon who reduced his price forecast<\/a> on the gaming stock to $58 from $64 while reiterating an \u201coutperform\u201d rating on the shares. He said this year is an \u201cinflection point\u201d for Caesars\u2019 digital unit and that the gaming company could generate as much as $5.40 a share next year in free cash flow (FCF).<\/p>\n

\u201cWhile we believe some remain concerned by leverage and Vegas\/Regional growth, we believe CZR’s position in Vegas is strong and we expect the story will remain driven by the company’s ability to improve Digital share and profits,\u201d wrote Beynon. \u201cOverall, we think CZR has an attractive risk\/reward digital profile given its large database, low marketing\/promo intensity and improving tech.\u201d<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

Shares of Caesars Entertainment (NASDAQ: CZR) rebound Wednesday from a post-earnings report slide late Tuesday and the gaming company\u2019s reiterated commitment to reducing debt could be one reason behind today\u2019s bounce back by the stock. Caesars has been using excess free cash flow to pare liabilities and improving earnings before interest, taxes, depreciation, and amortization […]<\/p>\n","protected":false},"author":46,"featured_media":220256,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[62,10,32093],"tags":[81897,81903,81966],"acf":[],"yoast_head":"\nCaesars Could Sell Non-Core Gaming Assets, Says CEO Reeg<\/title>\n<meta name=\"description\" content=\"Caesars Open to Selling \u2018Non-Core\u2019 Casinos to Reduce Debt.\" \/>\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-could-sell-non-core-gaming-assets-says-ceo-reeg\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Caesars Could Sell Non-Core Gaming Assets, Says CEO Reeg\" \/>\n<meta property=\"og:description\" content=\"Caesars Open to Selling \u2018Non-Core\u2019 Casinos to Reduce Debt.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.casino.org\/news\/caesars-could-sell-non-core-gaming-assets-says-ceo-reeg\/\" \/>\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=\"2024-05-01T19:51:29+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2024-05-09T03:27:13+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/07\/reeg.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1910\" \/>\n\t<meta property=\"og:image:height\" content=\"1074\" \/>\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-could-sell-non-core-gaming-assets-says-ceo-reeg\/\",\"url\":\"https:\/\/www.casino.org\/news\/caesars-could-sell-non-core-gaming-assets-says-ceo-reeg\/\",\"name\":\"Caesars Could Sell Non-Core Gaming Assets, Says CEO Reeg\",\"isPartOf\":{\"@id\":\"https:\/\/www.casino.org\/news\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/www.casino.org\/news\/caesars-could-sell-non-core-gaming-assets-says-ceo-reeg\/#primaryimage\"},\"image\":{\"@id\":\"https:\/\/www.casino.org\/news\/caesars-could-sell-non-core-gaming-assets-says-ceo-reeg\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/07\/reeg.jpg\",\"datePublished\":\"2024-05-01T19:51:29+00:00\",\"dateModified\":\"2024-05-09T03:27:13+00:00\",\"author\":{\"@id\":\"https:\/\/www.casino.org\/news\/#\/schema\/person\/f4cecf70a5032bc4e60eb73fc86d4a85\"},\"description\":\"Caesars Open to Selling \u2018Non-Core\u2019 Casinos to Reduce Debt.\",\"breadcrumb\":{\"@id\":\"https:\/\/www.casino.org\/news\/caesars-could-sell-non-core-gaming-assets-says-ceo-reeg\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/www.casino.org\/news\/caesars-could-sell-non-core-gaming-assets-says-ceo-reeg\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/www.casino.org\/news\/caesars-could-sell-non-core-gaming-assets-says-ceo-reeg\/#primaryimage\",\"url\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/07\/reeg.jpg\",\"contentUrl\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/07\/reeg.jpg\",\"width\":1910,\"height\":1074,\"caption\":\"Caesars CEO Tom Reeg in a 2021 CNBC interview. 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