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Penn National (PENN) Banks on Barstool Expansion Amid Pandemic
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Penn National Gaming, Inc. (PENN - Free Report) is likely to benefit from the sharp increase in sports betting demand and expansion of Barstool Sportsbook app. In the past year, shares of Penn National have gained 198.4% compared with the Zacks Gaming industry’s 54.4% rise. Notably, the company is confident about its long-term growth, which will be supported by a differentiated omni-channel approach.
However, cut-throat competition from peers, travel restrictions and uncertainties relating to the pandemic have negatively impacted the company.
Factors Driving Growth
Penn National, a leading gaming company in the United States, is known for its consistent business strategies and strong brand recognition. Through various acquisition and divestitures, the company’s presence is largely widespread. Even then, Penn National is continuing to expand and leverage its brand power. Its strategic partnerships with DraftKings, PointsBet, theScore and The Stars Group bode well. These partnerships will help the company maximize sport betting and iGaming across 19 states. DraftKings will cover Florida, Missouri, Ohio, Pennsylvania and West Virginia for 10 years. During fourth-quarter 2020, the company implemented the MyChoice reward program across all its properties and online channels. Notably, the initiative covers more than 20 million members across its land-based casinos and online platforms, thereby offering players a wide range of incentives.
Moreover, Penn National continues to focus on Barstool Sports expansion across the United States. On Jan 22, 2021, the company unveiled Barstool Sports online sports betting app in Michigan. Notably, the company witnessed solid demand and acquired a significant number of new customers on the back of its Barstool media partnership tools. On Mar 11, 2021, the company launched the Barstool Sportsbook app in Illinois, where the company performed better than expected within the first 30 days of launch. During the period, 54,700 new customers were registered. On May 18, 2021, the company scheduled the launch of Barstool Sportsbook mobile app in Indiana on iOS and android platforms. This marks the expansion of online sports betting to the fourth market after Pennsylvania, Michigan and Illinois.
Penn National continued to focus on the new generation of cordless, cashless and contactless technologies that are collectively known as 3C’s. Going forward, the company plans to launch the 3C's across its casinos in Pennsylvania. It also plans to roll out in other regions, subject to regulatory approvals.
Concerns
During first-quarter fiscal 2021, COVID-related travel restrictions and other containment efforts continued to impact the company significantly. Demand for casino gaming and related amenities was reduced, primarily owing to the impact of the pandemic.
Furthermore, the company is continuously facing intense competition from various casinos, video lottery, gaming at taverns and other Internet wagering services.
Some better-ranked stocks in the same space are Boyd Gaming Corporation (BYD - Free Report) , Red Rock Resorts, Inc. (RRR - Free Report) and Accel Entertainment, Inc. (ACEL - Free Report) . Boyd Gaming and Red Rock sport a Zacks Rank #1, while Accel Entertainment carries a Zacks Rank #2 (Buy).
Boyd Gaming has a three-five-year earnings per share growth rate of 19.8%.
Red Rock has a trailing four-quarter earnings surprise of 166.2%, on average.
Accel Entertainment’s 2021 earnings are expected to surge 757.1%.
5 Stocks Set to Double
Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor. Today, See These 5 Potential Home Runs >>
Unique Zacks Analysis of Your Chosen Ticker
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Penn National (PENN) Banks on Barstool Expansion Amid Pandemic
Penn National Gaming, Inc. (PENN - Free Report) is likely to benefit from the sharp increase in sports betting demand and expansion of Barstool Sportsbook app. In the past year, shares of Penn National have gained 198.4% compared with the Zacks Gaming industry’s 54.4% rise. Notably, the company is confident about its long-term growth, which will be supported by a differentiated omni-channel approach.
However, cut-throat competition from peers, travel restrictions and uncertainties relating to the pandemic have negatively impacted the company.
Factors Driving Growth
Penn National, a leading gaming company in the United States, is known for its consistent business strategies and strong brand recognition. Through various acquisition and divestitures, the company’s presence is largely widespread. Even then, Penn National is continuing to expand and leverage its brand power. Its strategic partnerships with DraftKings, PointsBet, theScore and The Stars Group bode well. These partnerships will help the company maximize sport betting and iGaming across 19 states. DraftKings will cover Florida, Missouri, Ohio, Pennsylvania and West Virginia for 10 years. During fourth-quarter 2020, the company implemented the MyChoice reward program across all its properties and online channels. Notably, the initiative covers more than 20 million members across its land-based casinos and online platforms, thereby offering players a wide range of incentives.
Moreover, Penn National continues to focus on Barstool Sports expansion across the United States. On Jan 22, 2021, the company unveiled Barstool Sports online sports betting app in Michigan. Notably, the company witnessed solid demand and acquired a significant number of new customers on the back of its Barstool media partnership tools. On Mar 11, 2021, the company launched the Barstool Sportsbook app in Illinois, where the company performed better than expected within the first 30 days of launch. During the period, 54,700 new customers were registered. On May 18, 2021, the company scheduled the launch of Barstool Sportsbook mobile app in Indiana on iOS and android platforms. This marks the expansion of online sports betting to the fourth market after Pennsylvania, Michigan and Illinois.
Penn National continued to focus on the new generation of cordless, cashless and contactless technologies that are collectively known as 3C’s. Going forward, the company plans to launch the 3C's across its casinos in Pennsylvania. It also plans to roll out in other regions, subject to regulatory approvals.
Concerns
During first-quarter fiscal 2021, COVID-related travel restrictions and other containment efforts continued to impact the company significantly. Demand for casino gaming and related amenities was reduced, primarily owing to the impact of the pandemic.
Furthermore, the company is continuously facing intense competition from various casinos, video lottery, gaming at taverns and other Internet wagering services.
Zacks Rank & Key Picks
Penn National currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Some better-ranked stocks in the same space are Boyd Gaming Corporation (BYD - Free Report) , Red Rock Resorts, Inc. (RRR - Free Report) and Accel Entertainment, Inc. (ACEL - Free Report) . Boyd Gaming and Red Rock sport a Zacks Rank #1, while Accel Entertainment carries a Zacks Rank #2 (Buy).
Boyd Gaming has a three-five-year earnings per share growth rate of 19.8%.
Red Rock has a trailing four-quarter earnings surprise of 166.2%, on average.
Accel Entertainment’s 2021 earnings are expected to surge 757.1%.
5 Stocks Set to Double
Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
Today, See These 5 Potential Home Runs >>