Penn National Gaming Price Target Pared, But Analyst Sees Fears Priced In
Penn National Gaming (NASDAQ:PENN) is trading higher today despite an psychoanalyst dramatically reducing his price target on the regional cassino operator.
In a take note to clients, Credit Suisse analyst Benjamin Chaiken reiterates an “outperform” rating on Penn, piece paring his damage calculate on the gillyflower to $99 from $128. Although $99 is a far outcry from $128, Chaiken’s new outlook on William Penn is stock-still more than twofold where the shares domicile today, and fountainhead above the Wall Street consensus of $71.
Analysts’ price targets on Penn are trending lower to go 2022 after the caudex was ane of the worst performers among gaming equities utmost year. But in that respect are signs of hope.
While November saw weaker results across the board (which inward our survey has goaded some of the weakness inward 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 gambling casino operator — a trait some market participants may get lost vision 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 Penn becoming a story stock up off the March 2020 coronavirus marketplace bottom. Arguably, it was also a reason out wherefore the shares slumped last year, as investors fretted virtually gaming companies’ ability to continue expanding margins at the stride seen forthwith following the onset of the pandemic.
Chaiken says securities industry participants’ concerns near sagging revenue and border eating away are likely factored into Penn’s apportion price.
“To this point, we reckon that concerns around decelerating revenues and deteriorating margins are priced in,” said the analyst.
Signs of Life for William Penn Stock
Penn throw off 12 percent inward Jan and the stock needs to more than three-bagger to homecoming to the all-time of $142. But at that place could be light-green shoots emerging, as the shares are higher past 7.57 percent o'er the yesteryear week.
Additionally, in that respect are potency tailwinds lingering for the stock, including the recent set in motion of sports betting inward Louisiana, where William Penn is one of the largest casino operators. There’s also intelligence that the iGaming and regulated sports wagering markets inward Ontario, Canada will undecided to private operators in April.
Last August, Penn paid $2 1000000000000 inward cash in and stock to gain Score Media and Gaming to gain a foothold inward the latterly liberalized Canadian sports wagering market.
“Launching theScore Bet inwards Ontario testament grade an exciting expanding upon of our online gaming business concern into a major young securities industry where we already have an naturalized peregrine sports media mathematical product inwards theScore app and a broad radix of loyal users,” said William Penn President and CEO Jay Snowden inwards a statement.
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