Should I Buy Penn Entertainment (PENN)? Finance YouTuber Analysis

The analyst highlights Penn Entertainment as a stock to watch, despite expected drops in earnings and slow sales growth. He previously recommended it due to its deal to run ESPN Bet, which has boosted subscribers beyond expectations. He anticipates more good news on the upcoming earnings report outlook.

“I highlighted pen is one of the seven best tech stocks to buy on its deal to run ESPN bet late last year the tie-up has already boosted subscribers Beyond expectations and there's a good chance we get more good news on the earnings report Outlook this week.”

The YouTuber recommends PEN Entertainment as a more attractively valued alternative to DraftKings in the online sports betting trend. Its deal with Disney and ESPN for ESPN Bet has significantly boosted user growth and its internet casino business. With potential growth from New York and North Carolina, PEN trades at a much lower price-to-sales ratio than DraftKings.

“pen entertainment ticker pnn which could be a buyout Target eventually on its recent Disney ESPN bet deal pen combines traditional retail gaming with 43 properties in 20 States along with that faster growing Online Marketplace.”

The YouTuber highlights Penn Entertainment's upcoming partnership with Disney for the ESPN BET app, believing it could significantly boost its sports betting market share. This deal is also seen as a potential precursor to an acquisition by Disney, which would further drive growth.

“Ahead of the company's November partnership with Disney on the new ESPN BET app rollout I highlighted that deal in last week's video and believe it could eventually result in an acquisition of pin by the house of mouse by Disney.”

The YouTuber notes that Penn National Gaming has a 106-107% return expected to its average analyst target, indicating strong analyst confidence in the gambling sector's recovery. He views this as a vote of confidence in the company's business model and fundamentals, suggesting good long-term return potential.

“We've also got a hundred and six hundred and seven percent return expected on Penn National Gaming.”

The analyst is buying Penn National Gaming for a coming rebound, highlighting its diversified gaming footprint and strong start in online gambling and sports betting. Despite a slowdown in growth from last year, mobile gaming revenue is strong, and the company authorized a share repurchase program. He finds the valuation very attractive at 1.5x price-to-sales, even with expected weak earnings due to heavy spending in the online betting race.

“Penn National has one of the largest and most diversified footprints in gaming with 44 properties in 20 states as well as a strong start in online gambling and sports betting... Valuation is very attractive here and I was actually surprised to see how low.”

The speaker expresses a bullish sentiment on Penn National's ESPN Bet venture, believing that ESPN's deeply ingrained brand in US sports culture, combined with Penn's two billion dollar investment in in-house technology (The Score), could allow them to capture a significant market share in the competitive sports betting landscape. They suggest that if ESPN Bet can innovate with features like real-time live betting integration during broadcasts, it could differentiate itself from competitors.

“I'm a little bit bullish on ESPN but I look like if I blow out my phone if I pull out the ESPN I'm looking at the ESPN app five times a day just blindly you know just seeing what's going on I have no idea I check espn.com every day you know there's some background Sports there's something going on ESPN for sports fans is so ingrained in our life here in the US if they can capitalize on this well just getting that Deluge of information in your face about betting it's going to be hard to pass up.”