BYD - PENN Entertainment: After Being Bullish I Am Now Bearish Absent A Boyd Gaming Deal

2024-06-27 11:15:30 ET

Summary

• PENN Entertainment, Inc. has struggled with earnings and digital results, particularly with their Barstool Sports acquisition.
• The company's foray into digital gaming has been costly, leading to potential interest from Boyd Gaming Corporation for an acquisition.
• A potential merger between PENN Entertainment and Boyd Gaming could create a powerhouse with significant cost-cutting and revenue potential.

Above: Sports betting has a low barrier of entry, slim margins but strong growth and takes the staying power of multi-millions of dollars to buy market share.

Premise:

My understanding of the long-term prospects of the PENN Entertainment, Inc. (PENN) shares was enlightened just after the company founders (the Carlino Racino interests of Philadelphia) had decided to split the businesses into an operating company which became Penn National Gaming (Now, PENN Entertainment) in 2012. The realty went to a REIT, Gaming & Leisure Properties (GLPI), which would own all of its operating company’s real estate assets, including its 43 properties. I spoke to friends and ex-colleagues who had migrated to Penn and managed departments in some of their key properties....

For further details see: