It makes sense and dollars to buy PENN Entertainment Inc. (PENN) stock

PENN Entertainment Inc. (NASDAQ: PENN) stock jumped 0.32% on Thursday to $24.97 against a previous-day closing price of $24.89. With 2.2 million shares changed hands, the volume of the stock remained lighter than its average volume of 2.56 million shares. During the session, the Resorts & Casinos company that operates in wider Consumer Cyclical sector, reached to the highest price of $25.30 whereas the lowest price it dropped to was $24.56. The 52-week range on PENN shows that it touched its highest point at $39.35 and its lowest point at $23.16 during that stretch. It currently has a 1-year price target of $37.38. Beta for the stock currently stands at 2.23.

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Price Performance and Earnings:

Stock performance is one of the indicators that investors use to determine whether they will profit from a stock. The price performance of PENN was down-trending over the past week, with a drop of -0.20%, but this was down by -11.23% over a month. Three-month performance dropped to -16.54% while six-month performance fell -30.89%. The stock lost -12.36% in the past year, while it has lost -15.93% so far this year. A look at the trailing 12-month EPS for PENN yields 4.02 with Next year EPS estimates of 1.94. For the next quarter, that number is 0.42. This implies an EPS growth rate of -47.50% for this year and -53.27% for next year. EPS is expected to grow by 8.79% annually over the next five years; however, over the past five years, the company experienced an annual growth rate of -30.70%.

Float and Shares Shorts:

At present, 153.30 million PENN shares are outstanding with a float of 152.87 million shares on hand for trading. On Apr 27, 2023, short shares totaled 14.39 million, which was 9.30% higher than short shares on Mar 30, 2023. In addition to CENN as the firm’s Cenntro Electric Group Limited, PENN serves as its PENN Entertainment, Inc.

Institutional Ownership:

Through their ownership of 89.14% of PENN’s outstanding shares, institutional investors have majority control over the company. Other institutions hold 45.64% of PENN, in contrast to 42.55% held by mutual funds. Shares owned by individuals account for 3.07%. As the largest shareholder in PENN with 11.96% of the stake, Fidelity Management & Research Co holds 18,244,070 shares worth 18,244,070. A second-largest stockholder of PENN, The Vanguard Group, Inc., holds 14,487,885 shares, controlling over 9.49% of the firm’s shares. HG Vora Capital Management LLC is the third largest shareholder in PENN, holding 14,000,000 shares or 9.18% stake. With a 4.34% stake in PENN, the Fidelity Blue Chip Growth Fund is the largest stakeholder. A total of 6,619,767 shares are owned by the mutual fund manager. The iShares Core S&P Mid Cap ETF, which owns about 3.17% of PENN stock, is the second-largest Mutual Fund holder. It holds 4,840,493 shares valued at 144.2 million. Baron Growth Fund holds 3.16% of the stake in PENN, owning 4,820,000 shares worth 143.59 million.

An Overview of Recent Financials:

Understanding a company as a customer does not mean you will understand it as an investor. The wise investor uses quantitative research to analyze metrics such as revenue, net income, and earnings. In its fiscal quarter reported on Mar 30, 2023, PENN reported revenue of $1.63B and operating income of $302.40M. The EBITDA in the recently reported quarter was $427.60M and diluted EPS was $0.15.

Analysts Ratings:

Reading analyst opinions is an effective way to decide where to invest, and there are several opinions available for PENN since 0 analysts follow the stock currently. In the same way, a target price assigned to a stock can also reveal much about its potential. With PENN analysts setting a high price target of $56.00 and a low target of $27.00, the average target price over the next 12 months is $36.82. Based on these targets, PENN could surge 124.27% to reach the target high and rise by 8.13% to reach the target low. Reaching the average price target will result in a growth of 47.46% from current levels.

EPS: Estimates vs Actual

It is also common to use earnings estimates to evaluate a firm’s growth potential and to determine trading strategy.

Summary of Insider Activity:

Insiders traded PENN stock several times over the past three months with 8 Buys and 13 Sells. In these transactions, 82,253 shares were bought while 37,674 shares were sold. The number of buy transactions has increased to 27 while that of sell transactions has risen to 20 over the past year. The total number of shares bought during that period was 454,605 while 267,051 shares were sold.

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