Last Updated: 19 Sep 2024
Executive Summary
Penn National Gaming Inc. (PENN) is a leading casino and racetrack operator in the United States. Despite facing challenges in recent quarters, the company has a strong track record of growth and profitability. PENN's stock is currently trading at $19.62, below its 52-week high of $27.2. Analysts have a mixed outlook on the stock, with 9 Buy ratings, 11 Hold ratings, and 0 Strong Buy ratings.
Company Overview
PENN operates casinos and racetracks in 19 states across the United States. The company's flagship property is the Hollywood Casino at Penn National Race Course in Pennsylvania. PENN also owns and operates casinos in Las Vegas, Mississippi, and other major gaming markets.
Fundamental Analysis
PENN's financial performance has been mixed in recent quarters. The company's revenue declined by 0.007% year-over-year in the most recent quarter, while its earnings per share (EPS) declined by 2.089%. However, PENN's EBITDA and gross profit both increased in the most recent quarter.
PENN's balance sheet is strong, with $1.6 billion in cash and equivalents and $3.2 billion in total debt. The company's debt-to-equity ratio is 1.4, which is within a reasonable range for the gaming industry.
Technical Analysis
PENN's stock price has been trending lower in recent months. The stock is currently trading below its 50-day and 200-day moving averages. The relative strength index (RSI) is at 35.4, which indicates that the stock is oversold.
Short Term Outlook
In the short term, PENN's stock price is likely to remain volatile. The company's earnings are expected to decline in the next quarter, which could put pressure on the stock price. However, PENN's strong balance sheet and positive long-term outlook could provide support for the stock price.
Long Term Outlook
In the long term, PENN's stock price is likely to be driven by the growth of the gaming industry. The gaming industry is expected to grow at a compound annual growth rate (CAGR) of 5.9% over the next five years. PENN is well-positioned to benefit from this growth, given its strong brand recognition and presence in key gaming markets.
Analyst Recommendations
Analysts have a mixed outlook on PENN's stock. Nine analysts have a Buy rating on the stock, while 11 analysts have a Hold rating. No analysts have a Strong Buy rating on the stock. The average analyst target price for PENN is $22.59, which represents a potential upside of 15.1% from the current price.
