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3 ETFs With Soaring Caesars Exposure

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3 ETFs With Soaring Caesars Exposure

Back from from the brink of its coronavirus lows, Caesars Entertainment (NASDAQ: CZR) isn't just relying as its status the largest casino operator in the U.S.

It's targeting iGaming and sports wagering dominance via a possible marriage with William Hill (OTC: WIMHY). Caesars is offering $3.69 billion for its sportsbook partner and private equity firm Apollo Global Management (NYSE: APO) could also make an offer.

However, Caesars isn't in this competition to play nice or finish second place. The company is telling William Hill that if opts to team up with Apollo, its current deal where it runs Caesars' domestic sportsbooks will be eliminated.

It remains to be seen if Apollo makes a competing bid for William Hill, but if Caesars takes the prize, the following exchange-traded funds could be worth considering for investors.

Invesco DWA Consumer Cyclicals Momentum ETF (PEZ)

Remembering that even with a more than nine-fold surge off its March lows, Caesars is still a mid-cap stock with a market capitalization of $8.68 billion, so it's not a major component in many of the 64 ETFs in which it dwells. The Invesco DWA Consumer Cyclicals Momentum ETF (NASDAQ: PEZ) has the largest weight to the casino operator at 4.02%, making it the fifth-largest holding in the fund.

PEZ follows the Dorsey Wright Consumer Cyclicals Technical Leaders Index, which uses relative strength as a prime determinant of securities' eligibility for inclusion. In other words, it can be argued Caesars' inclusion in this fund is impressive and it's one of just three casino stocks on the PEZ roster.

Roundhill Sports Betting & iGaming ETF (BETZ)

Already a force among this year's rookie ETFs, the Roundhill Sports Betting & iGaming ETF (NYSE: BETZ) isn't the next largest ETF holding of Caesars equity after PEZ, though BETZ has a 2.7% weight to the stock.

What makes BETZ highly relevant in this particular conversation is that the recent run-up in William Hill vaulted that name to the top spot on the BETZ roster at a weight of 9.41%. That's 77 basis points above the ETF's second-largest holding, giving the lone sports betting ETF the largest William Hill weight among all ETFs.

VanEck Vectors Gaming ETF (BJK)

The VanEck Vectors Gaming ETF (NASDAQ: BJK) joins BETZ in the small group of ETFs featuring exposure to both Caesars and William Hill. The Caesars Palace operator accounts for 3.40% of this fund, second-highest among all ETFs. The British bookmaker commands a 1.95% slice of BJK's roster. That's enough to have the fund higher by 3.41% over the past week.

 

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