Gambling is all about playing the odds to your advantage. In blackjack, a card counter can create a slight advantage against the house, and in poker, good players know how to read their opponents, creating an advantage.

Bets on gaming companies are similar, and the goal is to put the odds in our favor as much as possible. Right now, that means placing bets in Asia on operators like Wynn Resorts (NAS: WYNN) and Las Vegas Sands (NYS: LVS) . It also means avoiding bad bets on companies like MGM Resorts (NYS: MGM) , Boyd Gaming (NYS: BYD) , and maybe the worst bet of all: Caesars Entertainment.

The IPO that Caesars canceled last year is back on the table, and investors who bet on this IPO are making one of the worst bets I've ever seen in gaming. The company that was taken private in 2007 by Apollo Management and TPG took on too much debt right before the economy went into a recession. After years of struggling to reshape debt, the company is still much less attractive than any other company with Las Vegas exposure. Caesars' balance sheet makes MGM look like a conservative company.

Company

Cash

Long-Term Debt

Revenue (TTM)

Caesars Entertainment $1.15 billion $19.58 billion $8.78 billion
MGM Resorts $1.82 billion $13.10 billion $6.99 billion
Las Vegas Sands $4.14 billion $9.28 billion $8.89 billion
Wynn Resorts $1.78 billion $2.93 billion $5.16 billion

Sources: Company reports, Yahoo! Finance. TTM = trailing 12 months. Note: MGM, Las Vegas Sands, and Wynn consolidate majority-owned operations in Macau.

As proposed, a Caesars IPO would raise about $50 million for the company, but the terms often change quickly before a company goes to market. One driver of the IPO may be John Paulson's 9.9% stake in the company that he may be looking to sell in a bad year for his funds.

Considering that Caesars posted a $164 million loss in the most recent quarter, has no meaningful exposure to Asia, and relies on weak regional and Las Vegas markets for revenue, I'm wondering what the upside is...? I guess online poker would help Caesars, but MGM has arguably more attractive brands, so I think it would be a better bet.

If Caesars does pull off an IPO in coming weeks or months, it would be a long-shot gamble for gaming investors. Long odds aren't the kind of bets this Fool likes to make. To follow up on the companies mentioned here, I encourage you to add them to My Watchlist. It's a free service offered by The Motley Fool to track all your favorite stocks and bring you the most relevant and up to date news. You can click here now to access it. Fool on!

At the time this article was published Fool contributor Travis Hoium does not have a position in any company mentioned. You can follow Travis on Twitter at @FlushDrawFool, check out his personal stock holdings or follow his CAPS picks at TMFFlushDraw. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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