S&P 500   5,096.27
DOW   38,996.39
QQQ   439.00
Pure Storage, Hormel Foods rise; WW International, First Advantage fall, Thursday, 2/29/2024
Revolutionary Device Redefines Cancer Detection (Ad)
How major US stock indexes fared Thursday, 2/29/2024
Average long-term US mortgage rises to 6.94% after marking fourth-straight weekly increase
Revolutionary Device Redefines Cancer Detection (Ad)
Grads From This Midwestern School Are More Likely to Start a Billion Dollar Company Than Founders Who Went To Stanford, Harvard, or MIT: Study
It's Leap Day, and You're Probably Working — Here's How 'February 29' Affects Your Paycheck
Revolutionary Device Redefines Cancer Detection (Ad)
Stock market today: Wall Street quiet after breaking more records; another bank reports trouble
China's manufacturing activity contracts for 5th straight month despite policy support
S&P 500   5,096.27
DOW   38,996.39
QQQ   439.00
Pure Storage, Hormel Foods rise; WW International, First Advantage fall, Thursday, 2/29/2024
Revolutionary Device Redefines Cancer Detection (Ad)
How major US stock indexes fared Thursday, 2/29/2024
Average long-term US mortgage rises to 6.94% after marking fourth-straight weekly increase
Revolutionary Device Redefines Cancer Detection (Ad)
Grads From This Midwestern School Are More Likely to Start a Billion Dollar Company Than Founders Who Went To Stanford, Harvard, or MIT: Study
It's Leap Day, and You're Probably Working — Here's How 'February 29' Affects Your Paycheck
Revolutionary Device Redefines Cancer Detection (Ad)
Stock market today: Wall Street quiet after breaking more records; another bank reports trouble
China's manufacturing activity contracts for 5th straight month despite policy support
S&P 500   5,096.27
DOW   38,996.39
QQQ   439.00
Pure Storage, Hormel Foods rise; WW International, First Advantage fall, Thursday, 2/29/2024
Revolutionary Device Redefines Cancer Detection (Ad)
How major US stock indexes fared Thursday, 2/29/2024
Average long-term US mortgage rises to 6.94% after marking fourth-straight weekly increase
Revolutionary Device Redefines Cancer Detection (Ad)
Grads From This Midwestern School Are More Likely to Start a Billion Dollar Company Than Founders Who Went To Stanford, Harvard, or MIT: Study
It's Leap Day, and You're Probably Working — Here's How 'February 29' Affects Your Paycheck
Revolutionary Device Redefines Cancer Detection (Ad)
Stock market today: Wall Street quiet after breaking more records; another bank reports trouble
China's manufacturing activity contracts for 5th straight month despite policy support
S&P 500   5,096.27
DOW   38,996.39
QQQ   439.00
Pure Storage, Hormel Foods rise; WW International, First Advantage fall, Thursday, 2/29/2024
Revolutionary Device Redefines Cancer Detection (Ad)
How major US stock indexes fared Thursday, 2/29/2024
Average long-term US mortgage rises to 6.94% after marking fourth-straight weekly increase
Revolutionary Device Redefines Cancer Detection (Ad)
Grads From This Midwestern School Are More Likely to Start a Billion Dollar Company Than Founders Who Went To Stanford, Harvard, or MIT: Study
It's Leap Day, and You're Probably Working — Here's How 'February 29' Affects Your Paycheck
Revolutionary Device Redefines Cancer Detection (Ad)
Stock market today: Wall Street quiet after breaking more records; another bank reports trouble
China's manufacturing activity contracts for 5th straight month despite policy support

Better Luck Ahead For Casino Operators, But Not All Stocks Trading Higher

Better Luck Ahead For Casino Operators, But Not All Stocks Trading HigherGaming stocks are a mixed bag these days, with recent S&P 500 addition Penn National Gaming NASDAQ: PENN in a correction, while another new S&P component Caesars Entertainment NASDAQ: CZR, is trading at new highs. 

Meanwhile, smaller companies from the gaming industry, such as Golden Entertainment NASDAQ: GDEN and Century Casinos NASDAQ: CNTY are also notching new price highs. 

Are these investments just a roll of the dice, or is there something besides luck driving the performance of individual stocks?

Let’s look at Penn National first. The company, which operates casinos, resorts, off-track wagering facilities, and gaming apps. In 2020, the company acquired a 36% interest in digital media company Barstool Sports. Together, the companies operate the betting app Barstool Sportsbook. 


On May 6, Penn reported first-quarter results. Earnings jumped a whopping 817% year-over-year, to $0.55 per share, topping views of $0.30 per share. Revenue was $1.27 billion, a gain of 14% from a year ago, ahead of expectations for $1.13 billion. 

The quarter marks a turnaround after several quarters in a row of either losses or declining earnings growth. The earnings slide began even before the pandemic. 

The road ahead looks good for Penn, as more states legalize sports betting, and analysts are predicting a post-pandemic travel and leisure boom, particularly domestically. 

Nonetheless, shares are down 7.99% this week, to $79.88. Because it’s now part of the S&P 500, it’s prudent to track the stock along with the broader index. As it’s now a component of funds tracking this index, it will often move in tandem with broader market direction, as three-fourths of stocks tend to do. 

The S&P 500 is down 2.44% so far this week, at the low end of its range. 
Better Luck Ahead For Casino Operators, But Not All Stocks Trading Higher

Caesars Holds Above Key Averages

Fellow S&P 500 component Caesars Entertainment is also slumping after its earnings report last week. The stock is down 5.50% this week, to $100. Unlike Penn, which skidded below its 200-day average, Caesar’s is holding 5.8% above its 50-day line. 

Revenue was $1.7 billion, just slightly below estimates, but still a year-over-year gain of 259%. The company lost $2.06 per share, wider than the loss of $1.69 per share that analysts forecast. 

Here again, there’s plenty of reason for optimism ahead, with people ready to resume leisure travel. In Caesar’s earnings call, CEO Tom Reeg said he expects the company to post $1 billion in quarterly earnings at some point this year, and he’s eyeing more than $4 billion in earnings next year. 

Caesar’s has outperformed its index this year, notching a return of 40.95%, vs. 11.51%. 

Smaller gaming companies are faring a bit better this week.

Gaming Stocks Rally To New Highs

Golden Entertainment, which operates gaming resorts and restaurants, and distributes gaming equipment to casinos, rallied to a new high of $44.28, Monday, tacking on another 3.27% after Friday’s 17% gap-up following its earnings report. 

The stock is trading 5% lower with the broader market pullback Tuesday, but has a long way to go before closing Friday’s gap. 

The company beat top- and bottom-line estimates, with revenue of $239.7 million, and income of $0.35 per share. Both were up from the year-ago quarter. 

Century Casinos, which owns casino resorts, race tracks and Century Sports, a family bowling and game center in Canada, also retreated along with the broader market Tuesday. The stock rallied to a new high of $14.14 on Monday, following its earnings report last week. 

The stock is at lofty heights, hovering 11.6% above its 10-day moving average. As of now, it’s too far extended beyond any reasonable buy point to consider an entry; investors would be better served waiting for the next moving-average pullback. 

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Should you invest $1,000 in PENN Entertainment right now?

Before you consider PENN Entertainment, you'll want to hear this.

MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and PENN Entertainment wasn't on the list.

While PENN Entertainment currently has a "Moderate Buy" rating among analysts, top-rated analysts believe these five stocks are better buys.

View The Five Stocks Here

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Companies Mentioned in This Article

CompanyMarketRank™Current PricePrice ChangeDividend YieldP/E RatioConsensus RatingConsensus Price Target
PENN Entertainment (PENN)
4.2462 of 5 stars
$18.30+1.7%N/A-5.03Moderate Buy$31.47
Compare These Stocks  Add These Stocks to My Watchlist 

Kate Stalter

About Kate Stalter

  • stalterkate@gmail.com

Contributing Author

Retirement, Asset Allocation, and Tax Strategies

Experience

Kate Stalter has been a contributing writer for MarketBeat since 2021.

Additional Experience

Series 65-licensed investment advisor, financial advisor, Blue Marlin Advisors; investment columnist for Forbes, U.S. News & World Report

Areas of Expertise

Asset allocation, technical and fundamental analysis, retirement strategies, income generation, risk management, sector and industry analysis

Education

Bachelor of Arts, Saint Mary’s College, Notre Dame, Indiana; Master of Business Adminstration, Kellogg School of Management at Northwestern University

Past Experience

Founder, financial advisor for Better Money Decisions; editor, stock trading instructor for Investor’s Business Daily; columnist, podcast host, video host for MoneyShow.com; contributor for Morningstar magazine


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