{"id":215410,"date":"2022-05-30T15:18:20","date_gmt":"2022-05-30T22:18:20","guid":{"rendered":"https:\/\/www.casino.org\/news\/?p=215410"},"modified":"2022-05-30T16:00:20","modified_gmt":"2022-05-30T23:00:20","slug":"penn-national-gaming-earnings-quality-improving-says-credit-suisse","status":"publish","type":"post","link":"https:\/\/www.casino.org\/news\/penn-national-gaming-earnings-quality-improving-says-credit-suisse\/","title":{"rendered":"Penn National Earnings Improving Despite Tumbling Share Price"},"content":{"rendered":"

Simply because a stock\u2019s price is sliding doesn\u2019t mean the company can\u2019t generate increasing earnings per share (EPS). Penn National Gaming (NASDAQ:PENN) is a prime example of that scenario.<\/p>\n

\"Penn
A slide from a Penn National Gaming investor presentation. The stock is getting cheap while earnings are rising. (Image: Penn National Gaming)<\/figcaption><\/figure>\n

Credit Suisse recently screened S&P 500 member firms for names with the combination of faltering share prices, declining valuations, and improving earnings. Penn National made the cut and is the only gaming name among the 25 stocks highlighted by the bank.<\/p>\n

While the median company has seen their stock price fall -24.4% since its peak, the median P\/E multiple fell -27.5%,”<\/strong> strategist Jonathan Golub wrote in a recent client note. “This difference is explained by a healthy 3.3% increase in projected EPS.”<\/strong><\/p><\/blockquote>\n

Like other casino stocks, Penn is a travel and leisure<\/a> equity, placing it in the consumer discretionary sector. That\u2019s one of the worst-performing groups this year, as highlighted by Penn\u2019s 37.74% year-to-date decline. Fortunately, as Credit Suisse notes, earnings are improving among consumer cyclical names.<\/p>\n

\u201cOn a median basis, all 11 sectors have experienced an improvement in their earnings prospects. This disparity is most extreme for tech shares where the median valuation has fallen -35.7%, while earnings prospects have improved by 8.0%,\u201d adds Golub.<\/p>\n

Penn Particulars<\/h2>\n

Penn, the largest regional casino operator, is undoubtedly battered. This year, that\u2019s unusual among gaming equities.<\/p>\n

\n

Despite nearly wholesale selling across the gaming stock spectrum<\/a> in 2022, not all constituents in the space are offering value. Penn appears to be an exception. Following a drawdown of 78.6%, the casino stock\u2019s price-to-earnings ratio collapsed by almost 81%, according to Seeking Alpha.<\/p>\n<\/div>\n

Based on those metrics, Penn experienced the biggest drawdown and largest P\/E ratio decline among the 25 S&P 500 components mentioned by Credit Suisse.<\/p>\n

Some analysts view the casino company\u2019s strong first-quarter<\/a> results as impressive when considering that period is usually seasonally weaker than the June and September quarters.<\/p>\n

Potential Penn Catalysts<\/h2>\n

While the broader casino equity landscape is moribund for now and negative seasonality<\/a> could weigh on the group over the near-term, Penn could have some positive surprises in store for investors as the back of 2022 unfolds.<\/p>\n

Penn\u2019s margins look conservative and the operator\u2019s mini-casinos<\/a> in its home state of Pennsylvania are topping expectations.\u00a0 Some analysts view the operator as offering more attractive risk\/reward relative to rivals.<\/p>\n

Penn\u2019s online business, which includes Barstool Sportsbook, is a critical driver<\/a> for the stock, and that could prove all the more useful if the theScore Bet grows market share in Ontario, Canada. Earlier this year, the operator forecast a 2022 digital loss of $50 million, well below the original estimate of $80 million.<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

Simply because a stock\u2019s price is sliding doesn\u2019t mean the company can\u2019t generate increasing earnings per share (EPS). Penn National Gaming (NASDAQ:PENN) is a prime example of that scenario. Credit Suisse recently screened S&P 500 member firms for names with the combination of faltering share prices, declining valuations, and improving earnings. Penn National made the […]<\/p>\n","protected":false},"author":46,"featured_media":215411,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[10,33810],"tags":[],"acf":[],"yoast_head":"\nPenn National Gaming Earnings Quality Improving, Says Credit Suisse<\/title>\n<meta name=\"description\" content=\"Penn National Gaming valuations declining while earnings rise, says Credit Suisse.\" \/>\n<meta name=\"robots\" content=\"noindex, follow\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Penn National Gaming Earnings Quality Improving, Says Credit Suisse\" \/>\n<meta property=\"og:description\" content=\"Penn National Gaming valuations declining while earnings rise, says Credit Suisse.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.casino.org\/news\/penn-national-gaming-earnings-quality-improving-says-credit-suisse\/\" \/>\n<meta property=\"og:site_name\" content=\"Casino.org\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/Casino.OrgNews\" \/>\n<meta property=\"article:published_time\" content=\"2022-05-30T22:18:20+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2022-05-30T23:00:20+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/05\/penn3-1024x650.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1024\" \/>\n\t<meta property=\"og:image:height\" content=\"650\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Todd Shriber\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@etfgodfather\" \/>\n<meta name=\"twitter:site\" content=\"@Casino_Org\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Todd Shriber\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"2 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.casino.org\/news\/penn-national-gaming-earnings-quality-improving-says-credit-suisse\/\",\"url\":\"https:\/\/www.casino.org\/news\/penn-national-gaming-earnings-quality-improving-says-credit-suisse\/\",\"name\":\"Penn National Gaming Earnings Quality Improving, Says Credit Suisse\",\"isPartOf\":{\"@id\":\"https:\/\/www.casino.org\/news\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/www.casino.org\/news\/penn-national-gaming-earnings-quality-improving-says-credit-suisse\/#primaryimage\"},\"image\":{\"@id\":\"https:\/\/www.casino.org\/news\/penn-national-gaming-earnings-quality-improving-says-credit-suisse\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/05\/penn3.jpg\",\"datePublished\":\"2022-05-30T22:18:20+00:00\",\"dateModified\":\"2022-05-30T23:00:20+00:00\",\"author\":{\"@id\":\"https:\/\/www.casino.org\/news\/#\/schema\/person\/f4cecf70a5032bc4e60eb73fc86d4a85\"},\"description\":\"Penn National Gaming valuations declining while earnings rise, says Credit Suisse.\",\"breadcrumb\":{\"@id\":\"https:\/\/www.casino.org\/news\/penn-national-gaming-earnings-quality-improving-says-credit-suisse\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/www.casino.org\/news\/penn-national-gaming-earnings-quality-improving-says-credit-suisse\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/www.casino.org\/news\/penn-national-gaming-earnings-quality-improving-says-credit-suisse\/#primaryimage\",\"url\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/05\/penn3.jpg\",\"contentUrl\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/05\/penn3.jpg\",\"width\":2298,\"height\":1459,\"caption\":\"A slide from a Penn National Gaming investor presentation. 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