Caesars Entertainment, Inc. CZR is scheduled to report fourth-quarter 2024 results on Feb. 25, after the closing bell.

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In the last reported quarter, the company reported a negative earnings surprise of 119.1%.

Trend in CZR’s Estimate Revision

For the quarter to be reported, the Zacks Consensus Estimate for loss per share has widened to 15 cents from 10 cents in the past seven days. In the prior-year quarter, CZR incurred a loss of 34 cents per share.

For revenues, the consensus mark is pegged at $2.81 billion, indicating a slight decline of 0.5% from the year-ago reported figure.

Let us look at the factors that might have shaped CZR’s performance in the quarter under review.

Factors Likely to Shape CZR’s Q4 Results

Caesars Entertainment revenues are expected to have declined year over year due to increased competition and construction-related disruptions. Seasonal factors, including weather conditions in regional markets outside Las Vegas and shifts in visitor travel patterns, are also likely to have affected performance.

In the to-be-reported quarter, Regional segment's net revenues are expected to have been lower than the year-ago level due to construction disruptions at certain properties, adverse weather conditions and increased competition. The Zacks Consensus Estimate for total Regional revenues is pegged at $1.33 billion, implying a decline of 2.8% from the year-ago levels. The consensus estimate for Manage and Branded revenues is pegged at $68 million, flat year over year.

However, CZR is likely to have benefited from improving occupancy, ADR trends, renovations and increased sports-betting volumes. Also, an increased focus on digital initiatives and significant-tech enhancements to boost product offerings and drive better customer engagement is likely to have aided the company's performance in the fourth quarter.

The consensus estimate for total Las Vegas revenues is pegged at $1.09 billion, indicating a slight increase of 0.3% from the year-ago levels. The Zacks Consensus Estimate for total Caesars Digital revenues is pegged at $326 million, indicating a 7.2% increase from the year-ago levels.

The company is expected to have delivered a strong fourth-quarter performance despite unfavorable sports outcomes in October. A busy sports calendar in the following months is likely to have helped to recover some losses.

Growth of retail sports betting and property development projects are likely to have boosted the company’s top line in the to-be-reported quarter. The consensus estimate for total casino revenues is pegged at $1.62 billion, indicating an increase of 2.7% from the prior-year levels.

Meanwhile, the company’s bottom line is likely to have been strained by inflationary pressures, primarily in food, beverage and hotel expenses. Increased property openings and ongoing investments in new projects might have further impacted profitability. However, the company's focus on driving efficiencies through reducing same-store operating expenses is likely to have aided its bottom line in the fourth quarter.

What the Zacks Model Unveils for CZR

Our proven model predicts an earnings beat for Caesars Entertainment this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. This is exactly the case here.

Earnings ESP of CZR: Caesars Entertainment has an Earnings ESP of +0.87% at present. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

CZR’s Zacks Rank: Caesars Entertainment currently carries a Zacks Rank #3.

Other Stocks With Favorable Combination

Here are some other stocks from the Zacks Consumer Discretionary sector that investors may consider as our model shows that these, too, have the right combination of elements to deliver an earnings beat this time around.

Royal Caribbean Cruises Ltd. RCL has an Earnings ESP of +0.83% and a Zacks Rank of 2 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

RCL is expected to register a 40.7% increase in earnings for the to-be-reported quarter. It reported better-than-expected earnings in each of the trailing four quarters, delivering an average surprise of 15.7%.

Carnival Corporation & plc CCL currently has an Earnings ESP of +70.81% and a Zacks Rank of 3.

CCL reported better-than-expected earnings in each of the trailing four quarters, delivering an average surprise of 326.4%. Its earnings for the to-be-reported quarter are expected to increase 114.3%.

Planet Fitness, Inc. PLNT currently has an Earnings ESP of +1.35% and a Zacks Rank of 3.

PLNT reported better-than-expected earnings in each of the trailing four quarters, delivering an average surprise of 7.8%. Its earnings for the to-be-reported quarter are expected to increase 3.3%.

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This article originally published on Zacks Investment Research (zacks.com).

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