Penn National Gaming Price Target Pared, But Analyst Sees Fears Priced In
Penn National Gaming (NASDAQ:PENN) is trading higher today despite an analyst dramatically reducing his terms direct on the regional casino operator.
In a notation to clients, Credit Suisse psychoanalyst Benjamin Chaiken reiterates an “outperform” rating on Penn, piece sliver his price calculate on the inventory to $99 from $128. Although $99 is a far blazon out from $128, Chaiken’s unexampled outlook on Penn is still to a greater extent than dual where the shares shack today, and advantageously supra the Wall Street consensus of $71.
Analysts’ price targets on William Penn are trending lower to pop out 2022 after the carry was ace of the pip performers among gaming equities endure year. But there are signs of hope.
While Nov saw weaker results across the plank (which inwards our aspect has driven some of the weakness inwards the stock), Dec recovered, with revenues upward ~mid-single figure vs. November,” says Chaiken.
Pennsylvania-based Penn operates 44 casinos inwards 20 states.
Penn Could Perk Up
Penn is the largest regional casino manipulator — a trait some market participants may experience missed ken of inward the fervor surrounding online casinos and sportsbooks.
However, its position as a regional gaming behemoth cuts both ways. It was I of the contributing factors to William Penn seemly a story caudex away the Mar 2020 coronavirus market bottom. Arguably, it was also a understanding wherefore the shares slumped cobbler's last year, as investors interlaced almost gaming companies’ ability to carry on expanding margins at the pace seen right away next the onset of the pandemic.
Chaiken says marketplace participants’ concerns nearly sagging revenue and margin wearing away are potential factored into Penn’s portion out price.
“To this point, we imagine that concerns around decelerating revenues and deteriorating margins are priced in,” said the analyst.
Signs of Life for William Penn Stock
Penn moult 12 percent inward January and the stockpile needs to more than three-base hit to yield to the all-time of $142. But thither could follow green shoots emerging, as the shares are higher by 7.57 percent o'er the past times week.
Additionally, thither are potentiality tailwinds lingering for the stock, including the recent launch of sports betting in Louisiana, where William Penn is one of the largest casino operators. There’s also news that the iGaming and regulated sports wagering markets in Ontario, Canada will unresolved to common soldier operators in April.
Last August, Penn paid $2 one thousand million inward hard currency and stock to win Score Media and Gaming to earn a foothold in the of late liberalized Canadian River sports wagering market.
“Launching theScore Bet in Ontario testament brand an exciting elaboration of our online gaming business into a major young market place where we already have got an constituted wandering sports media mathematical product in theScore app and a wide stand of loyal users,” said Penn President and CEO Jay Snowden inwards a statement.