Caesars Is Stifel’s Top Casino Stock Idea for 2026
Posted on: January 7, 2026, 03:34h.
Last updated on: January 7, 2026, 03:34h.
- Stock was hammered last year as Las Vegas visitation slumped.
- Analyst says headwinds could become tailwinds for the casino stock this year.
- Strip asset sale still possible.
Coming off a year in which Caesars Entertainment (NASDAQ: CZR) tumbled 29% while the S&P 500 jumped 16%, some investors may be skittish about embracing the name, but it’s Stifel’s top casino stock idea for 2026.
In a new report to clients, analyst Steven Wieczynski said the Horseshoe operator is the firm’s top pick for 2026 among Las Vegas and Macau gaming names. He reiterates a “buy” rating on Caesars with a price target of $39, implying upside of more than 65% from current levels. Acknowledging that weak sentiment toward Las Vegas Strip operators of which Caesars is the second-largest plagued the stock last year, the analyst says easier Sin City comparisons could spark the stock in 2026.
We think the worst of the pullback is behind CZR at this point as management noted certain areas of Strip may have pushed price too far and September/October trends have improved sequentially from the trough levels of the deep summer,” notes Wiecyznski.
He adds that improved pricing rationalization, particularly at Caesars’ less glitzy Strip venues, could be another positive in 2026 because some cost-conscious consumers have felt priced out of the Strip by companies like Caesars and MGM Resorts International (NYSE: MGM).
Caesars Asset Sale Could Boost this Casino Stock
Several years ago, Caesars management tantalized investors with the prospect of a Strip asset, which would have gone a long way toward reducing the operator’s debt burden. However, a deal didn’t materialize, frustrating shareholders while keeping emphasis on the operator’s liabilities.
The gaming company’s efforts to divest a Las Vegas venue were hamstrung as the Federal Reserve boosted interest rates 11 times over the courses of 2022 and 2023, but with the central bank now in easing mode, it’s possible Caesars could find more willing buyers for one of its Las Vegas assets.
“However, with the Fed bringing rates back down a divestiture could come back into play, and we think any transaction that could facilitate debt reduction would be reflected positively in the share price,” adds Wieczynski.
The operator’s debt to adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) ratio stands at 6.7x — among the highest in the gaming industry. Wieczynski points out that the company hasn’t eliminated debt quickly enough since the Eldorado Resorts merger and that’s kept some prospective investors away from the casino stock. The analyst says improved free cash flow (FCF) generation from the operator’s digital, Las Vegas, and regional portfolios should propel debt reduction in 2026.
Digital Spin-Off Possible, Too
Another oft-discussed though still unrealized rumor is the possibility of Caesars spinning off its interactive unit, including the namesake sportsbook, because management believes the investment community isn’t assigning enough credit to the casino stock’s price for digital progress.
Wall Street expects Caesars Digital to post earnings before interest, taxes, depreciation, and amortization (EBITDA) of $370 million this year and if that target is met or topped, it puts management’s longer-ranging objective of $500 million in reach. Wieczynski says a strong 2026 for Caesars Digital could compel the company to revisit spinning off that business.
“It remains unclear what shape a divestiture/spin-off would take, but it has become clear to us that if the share price does not begin to reflect the value of the ramping online operations at some point, the two businesses make more sense apart (provided integrations between the loyalty program remain intact), and we think management would agree with us on that point,” says the analyst.
It’s a move that would make sense because by some estimates, the digital unit is worth more than the entire company and by selling even a portion of the unit to public investors, Caesars would likely haul in substantial proceeds that could be used for debt reduction.
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