Shares of Caesars Entertainment (NASDAQ:CZR) have been on a tear this year, jumping 122% to lead the gaming industry. The stock has easily surpassed its closes competitor MGM Resorts (NYSE:MGM), and is outperforming Las Vegas Sands and Wynn Resorts (NASDAQ:WYNN), who have a lot of exposure to Macau.

MGM Total Return Price Chart

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But, operationally, Caesars isn't the shining star it is on the stock market. Recently released first-quarter earnings numbers showed a 3% decline in Caesars' revenue, and every operating region was down. Atlantic City was the worst, falling 15.5%, after Hurricane Sandy ran through town and there really weren't any bright spots to point to. 

On the other hand, MGM Resorts continues to make slow and steady progress, driven by Macau. Overall, revenue was up 3% and domestic wholly owned resorts saw a 12% jump in EBITDA. Macau was a solid performer, with revenue up 6%, to $748 million, and EBITDA was up 10% to $180 million. 

The one negative for MGM was that debt hasn't been reduced from unsustainably high levels. Net debt at the end of the first quarter was $12.4 billion, up slightly from $12.25 billion at the end of 2012. It's important to note that MGM China did pay a $500-million dividend, of which $255 million went to MGM. Due to the way consolidated accounting works, this dividend actually increased net debt, so that accounted for a little bit of the net debt increase. I'd just like to see debt falling at a steady clip now that operations are improving.

No matter how you slice it, MGM Resorts is a much better company operationally than Caesars Entertainment. MGM China has already broken ground on a Cotai project that will add 1,600 hotel rooms, 2,500 slots, and 500 table games, which should be wildly profitable. The resort will sit between Wynn's new resort, and Las Vegas Sands' Cotai Central, and could add nearly $1 billion in EBITDA to the company. 

How to play Caesars' growth
If you're still enamored by Caesars, and are interested in buying into the Caesars growth spinoff, it's best to wait until the company actually becomes public. By buying Caesars today, you're getting a chance to buy into the company, but that will take extra cash, and you'll still be stuck with the "no growth" portion of the company.

For my money, MGM Resorts is the best of the two, and I think it will out perform Caesars, as Las Vegas recovers and it opens a new resort in Macau.

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