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Penn National Stock Dips as Earnings Fall Way Short

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The Tropicana Las Vegas, which Penn National Gaming manages under a lease agreement.
Ethan Miller/Getty Images

The gambling and esports company Penn National Gaming reported per-share earnings that amounted to only half of what Wall Street expected even though revenue was higher than anticipated.

Its outlook for this year was in line with the consensus forecast on Wall Street.

Earnings for the fourth quarter, which ended in December, were 26 cents a share, below estimates of 52 cents. Revenue in the quarter was $1.6 billion, higher than analysts’ consensus call of $1.51 billion.

The stock dropped 2.6% to $ 44.50 in Thursday’s premarket trading.

For 2022, Penn National (ticker: PENN) estimates revenue in the range of $6.07 billion to $6.39 billion. That compared with analysts’ expectations of $6.2 billion. It expects adjusted Ebitdar, or earnings before interest, taxes, depreciation, amortization, and rent in the range of $1.85 billion to $1.95 billion. Analysts expect Ebitdar of $1.92 billion, at the upper end of the guidance range.

 “Looking ahead, our differentiated sports betting strategy, along with the integration of the Barstool Sportsbook into theScore media app in the U.S. and continued improvements within our iCasino offerings will enable us to generate meaningful EBITDA in 2023 within the Interactive segment especially as we transition to our wholly owned tech stack,” said CEO Jay Snowden said. The company acquired the digital media company, Score Media and Gaming, known as theScore, in October last year.

More recently, Penn National Gaming  received an upgrade from Macquarie Research analysts. The analysts lifted the rating to Outperform from Neutral and raised their price target to $80 from $71, saying they “believe the market is giving little to no value for the online business.”

Write to Karishma Vanjani at karishma.vanjani@dowjones.com.

‘No, no, no, no, no!’ My wife and I are close to retirement, but we want to buy a house. Should I empty my 401(k) for the down payment?

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