PENN Entertainment (NASDAQ:PENN) Releases Earnings Results, Beats Expectations By $0.07 EPS

PENN Entertainment (NASDAQ:PENN) announced its quarterly earnings data on Thursday. The company reported $0.44 earnings per share for the quarter, beating the consensus estimate of $0.37 by $0.07, FiscalAI reports. PENN Entertainment had a negative net margin of 12.66% and a positive return on equity of 2.93%. The business had revenue of $1.86 billion for the quarter, compared to analyst estimates of $1.86 billion. During the same period in the prior year, the business posted ($0.12) earnings per share. PENN Entertainment’s revenue was up 5.2% compared to the same quarter last year.

Here are the key takeaways from PENN Entertainment’s conference call:

• Retail performance exceeded expectations, with record second-quarter revenue of $1.5 billion and adjusted EBITDA of $517.2 million, up approximately 4% and 6% year over year, respectively. Nine properties set quarterly revenue and EBITDA records.
• PENN raised its 2026 retail guidance to midpoint revenue of $5.87 billion and adjusted EBITDA of $1.963 billion, supported by expected mid-single-digit EBITDA growth and roughly 50 basis points of margin expansion in the second half.
• The company continues to improve cash flow and reduce leverage, helped by higher retail EBITDA, lower projected project CapEx, debt refinancings, and repayment of its remaining $106.7 million convertible notes. Management is targeting lease-adjusted net leverage below five times and traditional net leverage below two times.
• Interactive revenue guidance was reduced to $1.57 billion from $1.6 billion after customer-friendly sportsbook outcomes and lower volumes, although adjusted EBITDA improvement continued and the full-year loss target remains $20 million. Management expects the segment’s third-quarter loss to be its largest of the year, with profitability in the fourth quarter.
• Recently completed retail projects, including Hollywood Columbus, Hollywood Aurora, Joliet, and M Resort, are showing strong early demand, higher-value customer engagement, and revenue growth. PENN is also evaluating additional hotel and water-to-land projects, though management said these must compete with deleveraging, share repurchases, and other capital-allocation priorities.

PENN Entertainment Stock Up 0.2%

Shares of PENN traded up $0.05 during midday trading on Friday, hitting $20.18. The stock had a trading volume of 2,492,826 shares, compared to its average volume of 2,628,370. The firm has a market cap of $2.70 billion, a price-to-earnings ratio of -3.17, a price-to-earnings-growth ratio of 0.38 and a beta of 1.43. The company has a 50 day simple moving average of $20.78 and a two-hundred day simple moving average of $16.97. PENN Entertainment has a twelve month low of $11.65 and a twelve month high of $22.36. The company has a debt-to-equity ratio of 3.94, a current ratio of 0.82 and a quick ratio of 0.82.

Wall Street Analysts Forecast Growth

A number of research firms recently commented on PENN. Capital One Financial upgraded PENN Entertainment from an “equal weight” rating to an “overweight” rating and set a $26.00 price objective for the company in a report on Thursday, July 23rd. Truist Financial boosted their target price on PENN Entertainment from $20.00 to $25.00 and gave the stock a “buy” rating in a research report on Friday, June 26th. The Goldman Sachs Group started coverage on shares of PENN Entertainment in a report on Friday, June 26th. They set a “buy” rating and a $26.00 price objective for the company. Morgan Stanley upped their target price on shares of PENN Entertainment from $16.00 to $17.00 and gave the company an “equal weight” rating in a research note on Wednesday, May 6th. Finally, Stifel Nicolaus lifted their price target on shares of PENN Entertainment from $23.00 to $25.00 and gave the stock a “buy” rating in a research report on Friday, June 12th. One equities research analyst has rated the stock with a Strong Buy rating, twelve have issued a Buy rating, six have issued a Hold rating and one has given a Sell rating to the company. According to MarketBeat, PENN Entertainment currently has an average rating of “Moderate Buy” and a consensus price target of $23.35.

PENN Entertainment News Summary

Here are the key news stories impacting PENN Entertainment this week:

• Positive Sentiment: Benchmark raises rating and price target: Benchmark Co. lifted its price target from $21 to $22 and upgraded PENN to “Buy,” implying further upside from recent trading levels. Benzinga analyst rating report
• Positive Sentiment: Quarterly earnings beat expectations: PENN reported second-quarter adjusted earnings of $0.44 per share, ahead of estimates ranging from $0.35 to $0.37 and well above the prior-year result. Revenue of $1.86 billion was in line with expectations but increased 5.2% year over year. PENN tops Q2 earnings and revenue estimates
• Positive Sentiment: Improved outlook: Management is targeting more than 20% growth in 2026 adjusted EBITDAR and raised its retail revenue guidance to $5.87 billion, signaling confidence in casino demand and operating performance. PENN raises 2026 guidance
• Positive Sentiment: Broad-based casino demand: Reports characterized the quarter as showing improved profits and resilient demand across PENN’s casino operations. The company was also included in Zacks’ Rank #1 “Strong Buy” growth-stock list. Improved profits amid casino demand
• Neutral Sentiment: Revenue was merely in line: Although earnings exceeded forecasts, quarterly sales matched consensus estimates, limiting the size of the positive surprise. PENN sales in line with estimates
• Negative Sentiment: Prediction-market competition is a risk: PENN expects an “arms race” in prediction markets this fall while maintaining its current strategy, potentially increasing marketing costs and competitive pressure. PENN prediction-market competition

Institutional Investors Weigh In On PENN Entertainment

Hedge funds and other institutional investors have recently bought and sold shares of the company. Axxcess Wealth Management LLC lifted its stake in PENN Entertainment by 54.8% in the 4th quarter. Axxcess Wealth Management LLC now owns 55,075 shares of the company’s stock valued at $812,000 after acquiring an additional 19,500 shares in the last quarter. Mercer Global Advisors Inc. ADV grew its stake in shares of PENN Entertainment by 328.7% during the 4th quarter. Mercer Global Advisors Inc. ADV now owns 52,814 shares of the company’s stock worth $779,000 after acquiring an additional 40,493 shares in the last quarter. XTX Topco Ltd raised its holdings in shares of PENN Entertainment by 59.6% in the fourth quarter. XTX Topco Ltd now owns 38,933 shares of the company’s stock valued at $574,000 after purchasing an additional 14,534 shares during the last quarter. Susquehanna Portfolio Strategies LLC raised its holdings in shares of PENN Entertainment by 1,637.1% in the fourth quarter. Susquehanna Portfolio Strategies LLC now owns 194,365 shares of the company’s stock valued at $2,867,000 after purchasing an additional 183,176 shares during the last quarter. Finally, Engineers Gate Manager LP lifted its position in shares of PENN Entertainment by 1,255.7% in the fourth quarter. Engineers Gate Manager LP now owns 567,388 shares of the company’s stock worth $8,369,000 after purchasing an additional 525,536 shares in the last quarter. Institutional investors and hedge funds own 91.69% of the company’s stock.

About PENN Entertainment

PENN Entertainment, Inc (NASDAQ: PENN) is a leading operator of gaming and racing facilities in the United States. The company’s business activities encompass land-based casinos, pari-mutuel racetracks, off-track wagering, and ancillary amenities such as hotels, restaurants and entertainment venues. In August 2022, the company rebranded from Penn National Gaming to PENN Entertainment to reflect its expanding footprint across digital and traditional segments of the gaming industry.

The company’s portfolio includes well-known properties under the Hollywood Casino and Ameristar Casino brands, located across multiple states including Pennsylvania, Ohio, Missouri and West Virginia.