GM went bankrupt because of an unprecedented financial crisis that also took would have taken down ford and many banks without government loans or bailouts. Interesting that Ford tried company owned dealerships back in the 90s. They called it "Ford Retail Network". It failed within about 3 years. Elon has said that he would consider switching to a dealership network if he can get Tesla sales high enough to support independent dealers. What he doesn't want is for Teslas to be sold alongside gas engine cars from other manufacturers as he is concerned salespeople would downplay perceptions of his technology.
There are lots of reasons besides legal antitrust issues that virtually every large car manufacturer goes with the dealer sysem: much less capital is needed, the financial risks to the manufacturer are less and local dealers know their local markets better. Maybe Elon will become a successful pioneer of successful manufacturer owned dealerships. But for now, he is burning through a fortune trying to get this set up.
Considering that Loveman ran Caesar's into the ground while losing billions of dollars under his watch, I would say that paying him $1 would have been too much. He has finally been replaced by the former CEO from Hertz who left that company with disappointing results and all kinds of accounting issues.
The WF downgrade was to market perform from outperform. I don't know what their new price target is but the market is acting like they put out a sell, which they did not.
I checked and court hearing starts at 1:30 pm Chicago time. There are numerous motions to be heard so it looks like it will take most of or all afternoon.
CZR is giving back nearly all of its huge gains from yesterday. Looks like that motley fool article yesterday was on the money as it predicted this. If the bankruptcy court goes against Caesars today it could also be much worse, even driving CZR into bankruptcy. Anyone hear a decision yet?
Plane manufacturers took orders for twice as many planes as they delivered last year. This DOJ action also is odd as it coming on the heels of recent price weakness for the entire airline group due to analyst concerns of overcapacity and lower fares. I smell a big $$ penalty being sought. The greed of this government knows no bounds.
Paulson knows he's stuck. If he tried to sell his shares, he'd drive the price further into the ground. He's just hoping for the best. Sometimes even the big boys make mistakes.
There was a bloomberg article yesterday about a judge's ruling along with comments that CZR itself may have to file bankruptcy itself if the creditors are successful. If that happens, it is pretty much game over for this stock.
Good question. Another good question is how did Loveman get a huge increase in compensation last year while at the same time the company posted mind boggling losses? Loveman's total compensation jumped from $7.6 million in 2013 to $32.6 million in 2014. The answer is that besides being CEO he was the chairman of the executive committee and also the chairman of the BOD. His main concern is to take more money from the company before he drives it into the ground. No wonder he's hired a security firm to guard him and his family, again at stockholder expense. I'm sure there are lots of laid off employees and screwed over debt and stockholders who would love to get their pound of flesh off the bum.
1. Judge only gave CZR 2 weeks to come up with a new bankruptcy plan. Caesars had requested 6 months.
2. Judge is allowing creditors to fully examine Caesar's questionable prebankruptcy actions such as transferring assets out of CEOC before they filed for bankruptcy.
3. Steve Wynn in Wynn's conf call said strip business in Vegas and lousy and expects it to get worse.
4.Nevada gaming board announced March strip revenues were down over 9% from a year ago.
Not a good day for Caesars and I'll remain short.
This is a very large and complicated bankruptcy. It will take a long time to get it settled (maybe years) and in the meantime, CZR will continue to pile up losses. Earlier, you mentioned heavy call interest in some short term options but the dollar value is small. Take a look at the Jan 2016 options. Open interest in puts is huge and is almost 30 times greater than in calls. That gives more time for this bankruptcy issue to resolve itself and the big money is betting that this has much further to fall. CZR itself is warning that they may not be able to remain a going concern. If CZR is also pulled into bankruptcy, this will become a penny stock.
Can't blame some shorts for taking nice profits here but there are still plenty of shorts in this one with 14.4 days to cover. If I was a long, I would be more concerned as to why the stock price continues to fall despite the shorts taking some profits. I remain short.
I think those resort fees are a ripoff too. I don't think Station casinos charge them either. I haven't seen the Fox report but I imagine it's a class action suit. Just imagine the huge new losses that CZR would report if all those resort fees collected from former patrons had to be paid back.
In the news today, they replaced their key financial advisor with another one. Things are not going well for CZR's hopes to shed debt the way they planned. I remain short.
CZR reports another mind boggling $7 eps loss for Q4 vs analyst estimate of $1.65 loss. That makes a loss of $19.45 for the year (on top of $23 loss last year). Someone better call an ambulance or maybe it's too late already!
The only thing I'm aware of is that one of the CNBC traders commented yesterday that he bought the stock and call options after he noticed unusually high call volume in the stock options. This implies that someone who knows something that others don't is taking a leveraged position betting on the stock rising.
What wasn't said is that it could also be someone with a large long position selling calls to help hedge their position against further losses. I note that the volatility premium for puts is higher than the calls, suggesting that may well be the case here,
At any rate, earnings (Maybe I should say the report on further losses) comes out next week. CZR has been consistently losing much more than the analysts predict. We'll see but I think this will burst the balloon in this little rally. I remain short.
It's hard to see how a former CEO from auto rental and auto parts companies would be a good fit for a large casino company. On the other hand, he's a CEO with a demonstrated history of financial shenanigans....never mind, that should be a good fit at Caesars.