14.30 +0.27 (1.92%)
After hours: 7:59PM EDT
|Bid||13.86 x 800|
|Ask||13.95 x 1200|
|Day's Range||11.36 - 14.50|
|52 Week Range||6.02 - 70.74|
|Beta (5Y Monthly)||2.44|
|PE Ratio (TTM)||13.62|
|Earnings Date||May 25, 2020 - May 28, 2020|
|Forward Dividend & Yield||N/A (N/A)|
|1y Target Est||55.09|
To get a sense of just how volatile this market is, consider that Penn National Gaming (NASDAQ:PENN) stock has doubled from its lows. Yet, Penn National stock still is down 74% from its 52-week high.Source: Casimiro PT / Shutterstock.com The decline in PENN stock makes some sense. Casinos nationwide have been shut down amid the response to the novel coronavirus. Penn has a fair amount of debt on its balance sheet. It owes billions of dollars more in lease payments to Gaming and Leisure Properties (NASDAQ:GLPI), which Penn spun off in 2013, and Vici Properties (NYSE:VICI).But I've continually advised investors to take the long view in this market. Indeed, that's good advice for all of us as we navigate this unprecedented crisis.InvestorPlace - Stock Market News, Stock Advice & Trading TipsPenn National stock is a good example of the potential opportunities available in a market that is only focused on the short term. We will get through this crisis. Our economy will recover. And when it does, PENN should rally. The Risks Are Real…Again, it's not hard to see why some investors see Penn National stock as risky. The company is burning cash as its casinos nationwide stay closed. A report from Macquarie on March 24 suggested the company had just five months' worth of cash remaining. * 7 Telecom Stocks That Are Worth a Close Look Meanwhile, if a short-term recession follows even once casinos re-open, Penn ostensibly could face more trouble. It closed 2019 with $2.3 billion in long-term debt -- but that's not its largest liability.It carries lease liabilities on its balance sheet at over $8.5 billion. Total lease payments over the next 30 years exceed $20 billion. In the fourth-quarter release in early February, Penn said it expected those cash payments to be roughly $900 million in 2020.Penn has to make those payments even while its properties are closed. And the worry is that even when they re-open, business will be slow. Consumers may be loath to return to crowded casinos. Customers who have lost their jobs in the current crisis may take time to find new employment -- and have the discretionary spending required to visit Penn properties.To many investors, then, Penn National stock simply is too risky. And they're not completely wrong. Given debt and lease liabilities, PENN is a high-risk investment right now. But the rewards are huge -- and the risks may not be quite what some investors believe. …But Somewhat OverblownFrom both a short-term and long-term perspective, however, the risks may not be what they appear.Last week, Penn made a deal with GLPI to sell the Tropicana Las Vegas, and land under a project in Pennsylvania, for $337.5 million. Penn won't get the cash; instead it will get credit for rent going forward. The proceeds should cover about four months' of lease payments.Penn also, unfortunately, started furloughing workers on Wednesday. That will lower operating expenses. The company closed 2019 with $438 million in cash, which provides a further cushion.Again, investors have to understand the risks, and Penn will have short-term challenges. But the deal with GLPI creates a path to get through this crisis.Meanwhile, the history of the industry suggests it might be more resilient than some believe. In 2009, commercial casino revenues fell just 5%. Regional casinos saw an even smaller decline.Penn has a strong chance of getting through this crisis. And if it can, the long-term case looks attractive. The Case for Penn National StockAfter all, it was only two months ago that PENN stock was soaring.In late January, the company announced that it was acquiring a 36% stake in Barstool Sports for consideration of $163 million. The market loved the deal: PENN rallied sharply.It's not hard to see why. Barstool's audience represents a built-in base for Penn to drive significant revenue from sports betting. That's a multibillion-dollar opportunity for Penn National -- particularly as online sports betting takes hold.That opportunity still exists, even though PENN now trades below $10 instead of $35.I expect to see significant pent-up demand in the legacy business as well. The federal government has stepped up with relief, which should provide a bridge for the U.S. economy to bounce back. I still believe this decade will wind up being the Roaring 2020s, as I've named it, and casino operators like Penn can be huge beneficiaries.There are other sports betting plays out there. Diamond Eagle Acquisition (NASDAQ:DEAC) is acquiring fantasy sports operator DraftKings. Eldorado Resorts (NASDAQ:ERI) and Caesars Entertainment (NASDAQ:CZR) are set to merge.But DEAC hasn't declined as far as Penn National stock. Eldorado and Caesars don't have the same edge in sports betting that Penn does with Barstool.For long-term investors, there are opportunities in this space. I believe PENN is the best of them.Matthew McCall left Wall Street to actually help investors -- by getting them into the world's biggest, most revolutionary trends BEFORE anyone else. The power of being "first" gave Matt's readers the chance to bank +2,438% in Stamps.com (STMP), +1,523% in Ulta Beauty (ULTA) and +1,044% in Tesla (TSLA), just to name a few. Click here to see what Matt has up his sleeve now. Matt does not directly own the aforementioned securities. More From InvestorPlace * 25 Stocks You Should Sell Immediately * 1 Under-the-Radar 5G Stock to Buy Now * This Stock Picker's Latest Video Just Went Viral * The 1 Stock All Retirees Must Own The post Industry-Leading Penn National Stock Is Far From a Gamble appeared first on InvestorPlace.
Gambling activities worldwide are affected by coronavirus-induced restrictions. Shares of the companies in the industry have fallen since mid-January, while earnings expectations have been lowered.
Coronavirus is probably the 1 concern in investors' minds right now. It should be. On February 27th we published an article with the title Recession is Imminent: We Need A Travel Ban NOW. We predicted that a US recession is imminent and US stocks will go down by at least 20% in the next 3-6 […]
The hotel's general manager said a "core minimum staff" is maintaining the property, which he hopes to reopen later this spring.
Companies in a range of sectors hard-hit by the virus' spread and mass closures due to state and municipal quarantines benefited from the rebound.
For the gaming sector, investors are taking comfort that while U.S. casinos have been shut down, the operators have ample liquidity to last months and sometimes more than a year.
Eldorado Resorts, Inc. (NASDAQ: ERI) ("Eldorado," "ERI," or "the Company") announced today that it will temporarily suspend operations at Isle Casino Racing Pompano, Florida at 6PM EDT on March 18, 2020.
Casino stocks, already underwater over the past three weeks, took another deep dive following the news that Nevada Gov. Steve Sisolak ordered all nonessential businesses statewide to shut down for 30 days.
Eldorado Resorts, Inc. (NASDAQ: ERI) ("Eldorado," "ERI," or "the Company") announced today that, in accordance with an order from Nevada Governor Steve Sisolak, it will temporarily suspend operations at Eldorado Resort Casino Reno, Silver Legacy Resort Casino Reno, Circus Circus Hotel Casino Reno, Tropicana Laughlin Hotel and Casino and MontBleu Resort Casino & Spa Lake Tahoe at 11:59 PM PDT on March 17, 2020.
Eldorado Resorts, Inc. (NASDAQ: ERI) ("Eldorado," "ERI," or "the Company") announced today that, in accordance with an order from the Missouri Gaming Commission, it will temporarily suspend casino operations at Lumière Place Casino and Hotels St. Louis, Isle of Capri Casino Hotel Boonville, and Isle of Capri Casino Kansas City at 11:59 PM CDT on March 17, 2020.
Eldorado Resorts, Inc. (NASDAQ: ERI) ("Eldorado," "ERI," or "the Company") announced today that, in accordance with an order from Iowa Governor Kim Reynolds, it will temporarily suspend casino operations at the Isle Casino Hotel Bettendorf and Isle Casino Hotel Waterloo at 12PM CDT March 17, 2020.
Eldorado Resorts, Inc. (NASDAQ: ERI) ("Eldorado," "ERI," or "the Company") announced today that, in accordance with Governor Polis’s order, it will temporarily suspend casino operations at the Isle of Capri and Lady Luck Black Hawk at 8AM MDT March 17, 2020.
Eldorado Resorts, Inc. (NASDAQ: ERI) ("Eldorado," "ERI," or "the Company") announced today that, in accordance with the Mississippi Gaming Commission order, it will temporarily suspend operations at the Tropicana Greenville, Isle of Capri Lula and Lady Luck Vicksburg by midnight on Monday, March 16, 2020.
Eldorado Resorts, Inc. (NASDAQ: ERI) ("Eldorado," "ERI," or "the Company") announced today that it will comply with New Jersey Governor Murphy’s order and will temporarily suspend operations at the Tropicana Atlantic City in New Jersey to the public at 8PM EDT on Monday, March 16, 2020.
Eldorado Resorts, Inc. (NASDAQ: ERI) ("Eldorado," "ERI," or "the Company") announced today that it will comply with the Louisiana Gaming Control Board order and will temporarily suspend operations at the Isle of Capri Lake Charles, Belle of Baton Rouge and Eldorado Shreveport by midnight on Monday, March 16, 2020.
Eldorado Resorts, Inc. (NASDAQ: ERI) ("Eldorado," "ERI," or "the Company") announced today that it will close Grand Victoria Casino Elgin for fourteen days to comply with the Illinois Gaming Board (IGB) order to limit/prohibit mass gatherings in the state of Illinois.
Eldorado Resorts, Inc. (NASDAQ: ERI) ("Eldorado," "ERI," or "the Company") announced today that it will close Tropicana Casino Evansville for fourteen days to comply with the Indiana Gaming Commission (IGC) order to limit/prohibit mass gatherings in the state of Indiana.
Eldorado Resorts, Inc. (NASDAQ: ERI) ("Eldorado," "ERI," or "the Company") announced today that it will temporarily close Eldorado Scioto Downs in Columbus, Ohio as a precautionary measure to comply with the Ohio Department of Health (ODH) order to limit/prohibit mass gatherings in the state of Ohio.
Investors need to pay close attention to Eldorado Resorts (ERI) stock based on the movements in the options market lately.
Eldorado Resorts, Inc. (NASDAQ: ERI) ("Eldorado," "ERI," or "the Company") announced today that it has entered into a definitive agreement to sell the Montbleu Resort Casino & Spa in Lake Tahoe, Nevada to Maverick Gaming LLC.
While value investing hasn’t necessarily been the decade’s most beloved strategy, no one is a bigger proponent than billionaire Seth Klarman. The tactic, which has been a favorite of fellow Wall Street gurus like Warren Buffet and Benjamin Graham, involves seeking out stocks that appear cheap when compared to their peers based on a price-to-earnings basis. For quite some time, investors have been shying away from the strategy as the Russell 1000 Growth Index has outperformed the Russell 1000 Value Index since 2007.Even though the billionaire’s $29 billion hedge fund, Baupost Group, returned significantly less than the broader market in 2019, Klarman has defended the tactic. He believes that “selling pressure of value names has contributed to mis-pricings that represent potential opportunity for long-term investors”, arguing that value investing will pay off when “the rocket fuel that propelled markets in 2019 will run out.”It should also be noted that value stocks are typically cheaper, making them more likely to hold up during times of volatility, especially important given the market’s recent dramatic swings.Taking all of this into consideration, we used TipRanks’ Stock Comparison feature to look at 3 value stocks Klarman’s fund snapped up in the most recent quarter side-by-side. The tool revealed that each is not only Buy-rated, but also boasts some hefty upside potential. Here’s what we found out.Eldorado Resorts (ERI)Based in Reno, Nevada, Eldorado Resorts owns and operates 28 properties throughout the country, making it one of the top casino entertainment companies. In the fourth-quarter, Klarman's fund decided to acquire a stake in ERI, pulling the trigger on 389,026 shares worth over $23.2 million.Back in February, ERI reported that adjusted EBITDAR came in at $146.2 million, falling $1.3 million below Deutsche Bank’s Carlo Santarelli’s forecast. Having said that, the five-star analyst still views its long-term growth narrative as being strong, specifically citing its possible merger with Caesars. “Given the CZR upside yesterday, as well as recent trading action and the valuation dislocation created by said action, we don’t think the $1.3 million shortfall…will be overly meaningful,” he commented.Part of the issue when it comes to ERI is that due to the coronavirus induced sell-off, names inhabiting the regional gaming space have taken a significant portion of the impact. According to Santarelli, this is because gaming stocks “are levered equities and in a risk off environment, this is what tends to happen, they happen to be more trafficked in by trading oriented investors, and some, including ERI to a lesser extent, have had considerable moves higher on longer term aspirations that likely extend beyond investment horizons.”Despite the fact that like other players in the space, ERI has taken some major hits over the last few years, each drop of more than 20% has ultimately presented a compelling opportunity. This scenario is likely to play out this time around, in the Deutsche Bank analyst’s opinion.With ERI potentially being able to acquire financing and the Caesars merger likely to close, the deal is sealed for Santarelli. Along with his reiteration of a Buy rating, the analyst bumped up the price target from $66 to $68. Should the target be met, shares could be in for a 96% twelve-month gain. (To watch Santarelli’s track record, click here)Looking at the consensus breakdown, the rest of the Street is on the same page. 3 Buys and 1 Hold add up to a Strong Buy consensus rating. The $61.67 average price target puts the upside potential at 80%. (See Eldorado stock analysis on TipRanks)HP Inc. (HPQ)The tech giant best known for its printers and PCs has also found itself under Klarman’s microscope.Representing a new holding for the fund, Baupost spent $205.5 million to purchase 10 million HPQ shares during the fourth quarter. Based on its most recent quarterly results, the Street has also been thouroghly impressed. For EPS, HPQ flew past the consensus estimate if $0.54, with the result coming in at $0.65. On top of this, a stable revenue trajectory can be attributed to continued positive PC performance and EPS upside driven by impressive margins across both PCs and printing.That being said, the real takeaway for Amit Daryanani of Evercore ISI is that the company broke the news of a buyback program. This program stands to push shares significantly higher and is a better option than the Xerox tender offer, in the analyst’s opinion. “We think HPQ presented a credible and aggressive shareholder return policy that is an attractive alternative to the XRX $24 per share offer, which would be done heavily on HP’s balance sheet,” he noted.Daryanani points out that during a call with management they stated “HPQ remains open to a combination with XRX but needs to agree on value ascribed to HPQ, responsible capital structure and a realistic synergy target.” He added, “We think the call was incrementally insightful to understand HP’s framework going forward, though we think there remains a probability that HP could bid for XRX and in that scenario the buybacks could be more muted but FY22 EPS could end-up being higher. Our sense is investors likely prefer HPQ doing the $16 billion buyback vs. acquiring XRX.”As HPQ’s A3 platform has the superior cost structure compared to its peers and there are potential opportunities for margin expanision, Daryanani’s bullish thesis remains intact. Bearing this in mind, the five-star analyst reiterated an Outperform call and $26 price target, suggesting 23% upside potential. (To watch Daryanani’s track record, click here)What does the rest of the Street think? It turns out that other analysts take more of a cautious approach. With 2 Buys and 5 Holds, the consensus rating lands at a Moderate Buy. At $26, the average price target matches Daryanani’s forecast. (See HP stock analysis on TipRanks)ViacomCBS (VIAC)As one of the leading producers of premium entertainment content, ViacomCBS connects billions of people located all over the world. While shares have shed 49% of their value in the last six months, some members of the Street see the weakness as a buying opportunity.During the fourth quarter, Klarman’s fund added VIAC shares to its portfolio, 17 million to be exact. The new holding, which is worth $713.5 million, makes up 7.9% of the total portfolio.As for the analyst community, several believe that VIAC still looks like a solid buy even after it reported lackluster quarterly results. For Q4, not only did the figures land well below the Street’s predictions, but the outlook for 2020 OIBDA was also seen as a disappointment; management guided for $5.8-6.1 billion compared to the consensus’ $6.141 billion. Given this development, investors have expressed concerns about VIAC’s investment spend.Wolfe Research analyst Eric Katz doesn’t dispute the fact that the print was somewhat of a red flag, but argues that now, the worst could be behind Viacom. “Viewing the stock from a rosier lens, we believe mgmt. threw in the ‘kitchen sink’ for this Q4 report and we expect to see improvement in H2’20…At this point, it feels like a lot of the bad news is priced in with the stock trading at only 6.3x ’20E OIBDA & 5.5x ’20 EPS,” he explained.Additionally Katz highlights its new 3-pronged strategy for the year ahead. “At the new VIAC, the new strategy will focus on: 1) maximizing its content globally and across many platforms, with spend directed at growthier areas (i.e. streaming); 2) accelerating topline growth by leveraging its scale across distribution, advertising, and content licensing; and 3) continuing its strong momentum in streaming – VIAC already has 11 million domestic streaming subs and generates $1.6 billion in revenue,” he stated.Based on all of the above, Katz is optimistic about the stock’s long-term growth prospects, reiterating his bullish call. Even though he reduced the price target from $52 to $40, this still leaves room for a possible twelve-month gain of 82%. (To watch Katz’s track record, click here)Out on Wall Street, VIAC’s Moderate Buy consensus rating breaks down into 10 Buys, 8 Holds and 2 Sells assigned in the last three months. The $41.11 average price target brings the upside potential to 87%, just above Katz’s forecast. (See ViacomCBS stock analysis on TipRanks)