Longview

What: Shares of Caesars Entertainment Corp (NASDAQ:CZR) jumped as much as 27% today after it reported a surprise profit for the quarter. At 3:10 p.m., shares were up 11.6% from the previous close.

So what: Management said that total revenue was $1.14 billion in the quarter and net income improved from a $466 million loss a year ago to a $15 million profit, or $0.10 per share. Analysts were expecting a $0.17-per-share loss, but Caesars' results may not be exactly what they appear.  

Caesars didn't include its bankrupt Caesars Entertainment Operating Company in the results, leaving only the "good" assets in this quarter's report. For investors, this is still a bet on whether or not the entire company will be pulled into bankruptcy, which wasn't really represented in the surprisingly good results.

Now what: In my view, this is a dead-cat bounce and the problems Caesars Entertainment as a whole faces in keeping its company out of bankruptcy still exist. But this does show why it has tried to keep its good assets while pushing bad-performing assets and debt into the bankrupt operating company.

Eventually, I think the entire company will be pulled into bankruptcy and investors should stay away on a day like this.

Travis Hoium has no position in any stocks mentioned. The Motley Fool is short Caesars Entertainment. 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.