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Penn National Gaming Inc. Message Board

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  • neverabogey neverabogey Jun 3, 2011 11:54 AM Flag

    this is Morgan Stanley letter on PENN

    Price Target
    $45
    Equal to Base-Case scenario
    Bull Case
    $50
    (Implies 8.5x
    EV/ EBITDA)
    New developments outperform; Brisk regional recovery
    New developments generate incremental EBITDA of $300mm by 2013
    Upfront cannibalization impact is moderate ($40mm EBITDA impact in 2013)
    Organic same-store EBITDA CAGR of 8% through 2012
    Base Case
    $45
    (Implies 8.2x
    EV/ EBITDA)
    New developments offset cannibalization; Moderate regional recovery
    New developments generate total incremental EBITDA of $260mm by 2013
    Cannibalization impact is significant ($60mm EBITDA impact in 2013)
    Organic same-store EBITDA CAGR of ~6% through 2012
    Bear Case
    $34
    (Implies 7.9x
    EV/EBITDA)
    Project delays; Significant cannibalization; Weak regional recovery
    Returns from new developments are below expectations (EBITDA of
    $195mm)
    Cannibalization impact is significant (~$100mm EBITDA impact in 2013)
    Organic same-store EBITDA increases 2-3% annually through 2012

 
PENN
13.18+0.01(+0.08%)Sep 27 4:00 PMEDT