Mario Gabelli, the CEO and chairman of Gabelli Funds, possesses an extensive background in investing in gaming shares. Include Caesars Entertainment (NASDAQ: CZR) in that category.

In the most recent issue of Barron’s “Roundtable,” Gabelli cited Caesars as one of the 10 stocks he is currently most optimistic about. Among the 11 members of the financial journal’s stock-picking group, Gabelli was the sole individual to reference any gaming stocks. He mentions the possibility of a cash flow shift as one reason it’s “time to take a chance” on the second-biggest operator on the Las Vegas Strip.   "We see a significant turnaround in cash flow. Caesars is working down its debt, and repayments will accelerate,” Gabelli told Barron’s.

The gaming firm has $11.5 billion in debts, and its initiatives to reduce this debt have been thoroughly recorded. These strategies may include divesting assets, yet the operator of Harrah's hasn’t sold anything in 2023, raising doubts that the existing macroeconomic conditions favor consolidation in the gaming sector.

That might be due to persistently high interest rates, which also hold significance for Caesars investors for another reason. Given the company’s significant debt load, it could potentially save around $60 million annually in interest costs for every 100 basis points the Federal Reserve cuts rates.

 

Gabelli Discusses Ichan's Role in Caesars Shares

Gabelli observed that activist investor Carl Icahn holds 5% of Caesars stock, although the former did not explicitly state that the latter was a reason to possess the shares.

Icahn’s re-engagement with the casino operator has not boosted the stock. The stock would have to increase by approximately 10% to reach its level from May 2024 when it was disclosed that the investor was involved with it again.

Nonetheless, Icahn’s engagement with Caesars might bolster Gabelli’s optimistic outlook. In March, the gaming firm appointed two directors connected to Icahn to its board. Although Icahn has claimed he isn’t advocating for activism, he endorses the concept of Caesars separating its digital division, which encompasses Caesars Sportsbook.

Enhancing profitability in that division isn’t apparent in the stock, and by divesting, the company could generate shareholder value while gaining capital to lower debt or repurchase shares — all elements that could reinforce Gabelli’s favorable perception of the name.    

Gabelli Continues to Favor Golden Entertainment as Well

In the January issue of the Roundtable, Gabelli mentioned to Barron’s his favorable view on Golden Entertainment (NASDAQ: GDEN), a perspective he repeated in the midyear update, even though the stock had risen only 1.80% since the beginning of 2025

“(Golden’s) underlying real estate is worth the intrinisic value of the company,” Gabelli told Barron’s.

The investor holds a positive outlook on certain gaming-related companies as well. These consist of Fox Corp. (NASDAQ: FOX) and Sinclair Broadcasting (NASDAQ: SBGI). The former is entitled to purchase as much as 18.6% of FanDuel, while the latter holds warrants for 11.5 million shares of the regional casino operator Bally’s.