{"id":232889,"date":"2022-09-20T14:42:01","date_gmt":"2022-09-20T19:42:01","guid":{"rendered":"https:\/\/www.casino.org\/news\/?p=232889"},"modified":"2022-09-21T14:26:48","modified_gmt":"2022-09-21T19:26:48","slug":"penn-stock-still-prime-play-on-regional-casino-strength","status":"publish","type":"post","link":"https:\/\/www.casino.org\/news\/penn-stock-still-prime-play-on-regional-casino-strength\/","title":{"rendered":"Penn Entertainment Stock Supported by Regional Casinos"},"content":{"rendered":"

As the parent company of Barstool Sportsbook and other digital gaming enterprises, Penn Entertainment (NASDAQ:PENN) is often discussed through the lens of online gaming. But one analyst encouraged investors to place more emphasis on the company\u2019s land-based casinos.<\/p>\n

\"Penn
The Barstool Sports logo on a NASCAR uniform. An analyst says regional casinos are catalysts for Penn stock. (Image: Bloomberg<\/em>)<\/figcaption><\/figure>\n

In a note to clients today, Stifel analyst Steven Wieczynski reiterated a \u201cbuy\u201d rating on Penn stock with a $45 price target, implying 44% upside from current levels. The investment bank recently hosted Penn CEO Jay Snowden for a series of investor meetings, and the analyst came away encouraged by the chief executive\u2019s commentary on third-quarter regional casino trends.<\/p>\n

Regional gaming trends remain healthy across PENN\u2019s broader portfolio, with management highlighting a robust Labor Day weekend and stable trends into early September,\u201d<\/strong> wrote Wieczynski.<\/p><\/blockquote>\n

He acknowledges that Penn stock could be volatile in the near term because of increasing macroeconomic fears. But the risk\/reward proposition offered by the shares is attractive. As for rising interest rates, persistently high inflation,<\/a> and the specter of waning consumer spending, those could pinch the entire casino equity complex, not just Penn.<\/p>\n

Penn Stock Not All About Sports Betting<\/h2>\n

Going back to 2020, when Penn acquired its initial stake in Barstool Sports<\/em>, investors have often viewed the stock as a play on iGaming and online sports betting while ignoring the regional casino part of the equation.<\/p>\n

\n

Some of that is attributable to Barstool Sports<\/em> founder David Portnoy<\/a> being viewed, in some circles, as the face of Penn. The reality is he has no official executive role at the gaming company, and while internet casinos and sports betting are the \u201cnext big things\u201d in the gaming industry, investors focusing on those drivers when it comes to Penn risk missing the value of the company\u2019s cash flow-generating land-based casinos business.<\/p>\n<\/div>\n

\u201cThe majority of PENN\u2019s customers live within a ~20-minute drive, limiting potential headwinds from elevated gas prices,\u201d added Wieczynski. \u201cThe 65+ demographic is still yet to fully return, with average daily theoretical still ~20% off 2019A levels. Fifth and perhaps most importantly, management has a well-communicated plan to streamline operations in a potential recession, citing the ability to offset as much as 45% of theoretical revenue declines via cost cuts.\u201d<\/p>\n

The Pennsylvania-based company is the largest regional casino operator in the US and does not run land-based gaming properties outside this country. That\u2019s a plus at a time when the dollar is strong<\/a>\u00a0and some competitors are grappling with ongoing COVID-19 protocols in Macau.<\/p>\n

Penn Stock Points of Emphasis<\/h2>\n

On the other hand, it\u2019s football season,<\/a> and some investors are inclined to view Penn stock as a sports betting play. That scenario is heightened by the company\u2019s exposure to Ontario, Canada — a market that thus far has disappointed operators and investors alike.<\/p>\n

In more encouraging news, Penn\u2019s promotional spending has long been rational relative to industry norms, and that precedent remains in place today. The company is also making investments in important regions to bolster market share.<\/strong><\/p>\n

\u201cWe believe PENN continues to invest aggressively in a handful of key markets (Ontario, KS, LA), with management reiterating their expectation for Q3 to be trough Adj. EBITDA losses before inflecting to Adj. EBITDA positive in Q4 (we sensed high conviction from management here),\u201d concluded Wieczynski.<\/p>\n","protected":false},"excerpt":{"rendered":"

As the parent company of Barstool Sportsbook and other digital gaming enterprises, Penn Entertainment (NASDAQ:PENN) is often discussed through the lens of online gaming. But one analyst encouraged investors to place more emphasis on the company\u2019s land-based casinos. In a note to clients today, Stifel analyst Steven Wieczynski reiterated a \u201cbuy\u201d rating on Penn stock […]<\/p>\n","protected":false},"author":46,"featured_media":232891,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[62,10],"tags":[82182],"acf":[],"yoast_head":"\nPenn Stock Still Prime Play On Regional Casino Strength<\/title>\n<meta name=\"description\" content=\"Regional casinos key to Penn stock thesis, according to analyst.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.casino.org\/news\/penn-stock-still-prime-play-on-regional-casino-strength\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Penn Stock Still Prime Play On Regional Casino Strength\" \/>\n<meta property=\"og:description\" content=\"Regional casinos key to Penn stock thesis, according to analyst.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.casino.org\/news\/penn-stock-still-prime-play-on-regional-casino-strength\/\" \/>\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=\"2022-09-20T19:42:01+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2022-09-21T19:26:48+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/09\/Penn.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1200\" \/>\n\t<meta property=\"og:image:height\" content=\"771\" \/>\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=\"3 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-stock-still-prime-play-on-regional-casino-strength\/\",\"url\":\"https:\/\/www.casino.org\/news\/penn-stock-still-prime-play-on-regional-casino-strength\/\",\"name\":\"Penn Stock Still Prime Play On Regional Casino Strength\",\"isPartOf\":{\"@id\":\"https:\/\/www.casino.org\/news\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/www.casino.org\/news\/penn-stock-still-prime-play-on-regional-casino-strength\/#primaryimage\"},\"image\":{\"@id\":\"https:\/\/www.casino.org\/news\/penn-stock-still-prime-play-on-regional-casino-strength\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/09\/Penn.jpg\",\"datePublished\":\"2022-09-20T19:42:01+00:00\",\"dateModified\":\"2022-09-21T19:26:48+00:00\",\"author\":{\"@id\":\"https:\/\/www.casino.org\/news\/#\/schema\/person\/f4cecf70a5032bc4e60eb73fc86d4a85\"},\"description\":\"Regional casinos key to Penn stock thesis, according to analyst.\",\"breadcrumb\":{\"@id\":\"https:\/\/www.casino.org\/news\/penn-stock-still-prime-play-on-regional-casino-strength\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/www.casino.org\/news\/penn-stock-still-prime-play-on-regional-casino-strength\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/www.casino.org\/news\/penn-stock-still-prime-play-on-regional-casino-strength\/#primaryimage\",\"url\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/09\/Penn.jpg\",\"contentUrl\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/09\/Penn.jpg\",\"width\":1200,\"height\":771,\"caption\":\"The Barstool Sports logo on a NASCAR uniform. 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