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Penn National (PENN) to Launch Sports Betting in Michigan

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Most of the gaming companies have been trying to capitalize on sports betting, following its legalization outside Nevada. So, it comes as no surprise that Penn National Gaming, Inc. (PENN - Free Report) has been leaving no stone unturned to strengthen presence in sports betting. The company has received green signal from the Michigan Gaming Control Board ("MGCB") for online sports wagering and iCasino products in Michigan.

The company will officially launch its Barstool Sportsbook mobile app on iOS and android, and desktop on Jan 22, 2021. Moreover, the company will also introduce iCasino products, subject to final regulatory approval. The company has already launched its retail Barstool Sportsbook at Greektown Casino Hotel in downtown Detroit on Dec 23, 2020.

Jay Snowden, president and CEO of Penn National said “As the only gaming operator with a fully integrated sports media and entertainment partner, Penn can provide our customers the opportunity to interact with Barstool personalities online and also in-person at our new Barstool Sportsbook at Greektown.”


 

Coming to price performance, shares of Penn National have skyrocketed 178.9% in the past six months, compared with the industry’s rally of 38.4%. The outperformance can primarily be attributed to the company’s expansion initiatives and cost-saving efforts. Going forward, the company remains confident about its long-term prospects on the back of its differentiated omni-channel approach. Also, partnership with Barstool Sports is likely to drive revenues in the days ahead.

Increased Focus on Barstool Sports Partnership

In February 2020, Penn National had reached an agreement to acquire 36% interest in Barstool Sports for nearly $163 million. The partnership provides Penn National with access to a database of 66 million sports enthusiasts (or Barstool loyalist), out of which 60% are into sports betting while the remaining are avid betters.

During third-quarter 2020, the company unveiled Barstool Sports online sports betting app in Pennsylvania. Within the first two weeks of launch, the company acquired a significant number of new customers on the back of higher promotional allowances. Going forward, the company plans to launch standalone Barstool branded entertainment destinations, thereby acting as a virtual sports books where sports betting is allowed.

Zacks Rank & Key Picks

Penn National, which shares space with Boyd Gaming Corporation (BYD - Free Report) , currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks worth considering in the same space include Red Rock Resorts, Inc. (RRR - Free Report) and Corsair Gaming, Inc. (CRSR - Free Report) . While Red Rock Resorts sport a Zacks Rank #1 (Strong Buy), Corsair Gaming carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Shares of Red Rock Resorts have gained 135.1% in the past six months.

Shares of Corsair Gaming have soared 167.6% in the past six months.

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