Back in April, I recommended Caesars Entertainment Corp. (NASDAQ:CZR) as a buy – but warned you that this was a play that might take some time to mature.
If you haven’t gotten in already, you’ll want to do it soon.
After months of bitter wrangling, the much-beleaguered Caesars has finally reached a $5 billion deal with the private equity sponsors that looted the company, Apollo Global Management, LLC (NYSE:APO) and TPG Capital (formerly Texas Pacific Group). Pending approval by the U.S. Bankruptcy Court in Chicago, CZR is now set to leave bankruptcy, get rid of its debt, and get back on its feet.
Of course, this means very good news for stockholders (like you, I hope).
Here’s why you can expect to start seeing profits…
This morning, Deutsche Bank hit a record low, dropping 6.5% to below $12. So far this year, the embattled bank has lost 52%.
As I warned you in February, Deutsche Bank is the proverbial canary in the coal mine of the global financial system. It poses systemic risk because it is poorly managed, even more poorly capitalized, and party to $60 trillion of derivatives contracts.
Now the U.S. government is chasing it down for billions of dollars of penalties on fraudulent mortgages it sold before the financial crisis, but German Chancellor Angela Merkel has said that the German government will not bail out the bank if it runs out of money. This is a recipe not only for DB stock to drop to where global interest rates are – zero – but to damage the rest of the financial system on the way.
And right now, one of our DB puts is up a whopping 166%.