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Penn Entertainment Stock Surges After Upgrade From JPMorgan, Anticipating Growth
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Main points
- JPMorgan Chase & Co. raised its rating on Pennsylvania Entertainment Co.’s stock, predicting its investment will start to pay off, sending the company’s shares sharply higher on Friday.
- Analysts upgraded Penn’s rating to “overweight” from “neutral” and raised the price target to $27 from $19.
- Despite Friday’s gains, Penn stock has fallen by nearly a fifth since the start of the year.
Payne Entertainment (payneJPMorgan upgraded its rating on the casino operator’s stock on Friday, predicting growth as its investment begins to pay off.
The firm upgraded Penn to “overweight” from “neutral” and raised its price target to $27 from $19, which would imply an upside of about 30% from Friday’s intraday price of $20.81.
Analysts told clients they believe Penn’s investments in retail projects “start to bear fruit and ultimately generate attractive double-digit cash returns” starting in the second half of 2025 and into 2026.
they expect to improve free cash flow That’s because land-based capital spending “declines significantly” in 2026 and Penn has the ability to use free cash flow to “deleverage and reduce less onerous cash interest expenses.” They also cited a decline in the company’s interactive gambling losses.
Penn’s shares were up 4% in early trading on Friday. Despite Friday’s gains, the company’s shares have fallen by nearly a fifth since the start of the year.
trading view
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