Short Interest Indicates Caesars Entertainment Corporation (CZR) Will Fall

In the latest fortnight, short interest in Caesars Entertainment Corporation (NASDAQ:CZR) stock jumped by 6.54%, indicating a significant rise in bearish sentiment. When it comes to determining how a name is viewed by investors, short interest is often a useful tool. The average analyst recommendations at 2.1 suggests buying these shares. Between November 15 and November 30, the total number of shorted shares amounted to 105 million shares. That was 6,444,656 more shares than the total of 98.56 million shares in the space of prior two weeks, which means more traders or funds betting that the stock will go down. Average daily volume for CZR at the November 30th settlement plunged to 12,890,394, as compared to 22,028,448 at the November 15th report. That brought days to cover to 8.107348, a 81.21% increase from the 4.474003 days to cover recorded at the prior short interest data release.

Investors will get their next glimpse of CZR’s Q4 earnings on March 05. Analysts are forecasting revenue to climb 7.5 percent to $2.11B in the next fiscal quarter, while earnings are seen soaring by nearly -139.13 percent to -$0.09 per share. History has shown that shares in Caesars Entertainment Corporation have gone up on 13 different earnings reaction days and are predicted to add 0.04 percent when the company reports upcoming earnings. In last reported earnings results, it earned $0.14 per share, better than the $0, adjusted, expected by Thomson Reuters consensus estimate. Revenue was $2.19B, worse than the $2.21B analysts expected. Earnings are estimated to increase by 86.9 percent this year, 0 percent next year and continue to increase by 0 percent annually for the next 5 years.

Caesars Entertainment Corporation (CZR) will probably climb 104.64 percent over the next 12 months, according to price target estimates compiled by finviz. Meanwhile, they have set a $15-month high price target. This represents a whopping 148.76 percent increase from where shares are trading today. The 12-month median price target assigned by the analysts stands at $13, which represents a return potential of 115.59 percent when compared to the closing price of the stock of $6.03 on Friday, December 21. The lowest price target for the stock is $9 — slightly more than 49.25 percent from CZR’s current share price.

The stock is currently hovering around the first support level of $5.84. Below this, the next support is placed in the zone of $5.64. Till the time, the CZR stock trades above this level, bulls have nothing to fear. On momentum oscillators front, ‘RSI’ has touched 23.36 on daily chart, which may remain a cause for comfort. If the price breaks below $5.64 level on closing basis, then we may see more profit booking and the stock may show further weakness. On the flipside, hitting the $6.32 mark may result into a pull-back move towards $6.6 level.

On 21st of December, Caesars Entertainment Corporation (NASDAQ:CZR) shares ended lower after a volatile session. The shares dropped -0.35 points or -5.49 percent at $6.03 with a heavy trade volume of 31.162 million shares. After opening the session at $6.38, the shares went as high as $6.4093 and as low as $5.93, the range within which the stock’s price traded throughout the day. The firm is left with a market cap of $4.02 billion and now has 667.03 million shares outstanding. Caesars Entertainment Corporation (CZR) stock has lost -23.09 percent of market value in 21 trading days.

CZR stock has a trailing 3-year beta of 0.79, offering the possibility of a lower rate of return, but also posing less risk. The portion of a company’s profit allocated to each outstanding share of common stock was $1.38 a share in the trailing twelve months. The stock’s value has fallen -52.33 percent year to date (YTD) against a decline of -52.52 percent in 12 month’s time. The company’s shares still trade -58.41 percent away from its 1-year high of $14.50 and -2.58 percent down from 52-week low of $6.19. The average consensus rating on the company is 2.1, on a scale where 5 equates to a unanimous sell rating. In short, the mean analyst recommendations are calling this stock a sell.

Shares of Caesars Entertainment Corporation (CZR) are trading at a P/E ratio of 6.24 times earnings reported for the past 12 months. The industry CZR operates in has an average P/E of 18.36. Its P/E ratio went as low as 0.2X and as high as 0.2 over the 5-year span. Further, it is sporting a 0.49 on the Price-to-Sales ratio. Compare this with the industry average P/S of 3.23. 52.7 percent is the gross profit margin for Caesars Entertainment Corporation and operating margin sits at 14.6 percent. Along with this, the net profit margin is 26.7 percent.

Let’s take a look at some insider activity at Caesars Entertainment Corporation (NASDAQ:CZR) and see the pattern. The earliest insider trade took place on 12/21/2018. Chugg Juliana L gathered a total of 15.68 thousand shares of company at average share price of $6.38. The total for the purchase was set at $100.01 thousand. After this transaction, the Director account balance stood at 23.74 thousand shares. The stock lost -5.49 percent since that insider purchase. On 12/21/2018, Kornstein Don R, Director, purchased 20 thousand shares at a price per share of $6.29. This added 125.8 thousand shares to the insider’s fortune and the stock saw a -4.13 percent retreat in value since the news became public. This transaction left 103.55 thousand shares in the Director account.

On 12/19/2018, Director Kornstein Don R performed a purchase transaction worth $173.75 thousand. This purchase at $6.95 each has added 25 thousand shares into the insider’s portfolio position. Meanwhile, shares have recorded -13.24 percent decrease since the transaction was reported. The insider now is left with 83.55 thousand shares remaining in the account. Benninger Thomas M., who performs the Director job, bought 41 thousand shares for $319.39 thousand. The acquisition occurred on 11/20/2018 was priced at $7.79 per share. The share price plunged -22.59 percent since the reporting date. Benninger Thomas M. now left with a stake of 4.5 thousand CZR stock worth $27.14 thousand after the insider buying.