Nomura Securities maintains a 'Neutral' on Penn National Gaming (PENN); At This Point, Negatives Outweight Positives
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Price: $18.61 -0.96%
Rating Summary:
27 Buy, 13 Hold, 1 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 12 | Down: 23 | New: 20
Rating Summary:
27 Buy, 13 Hold, 1 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 12 | Down: 23 | New: 20
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Nomura Securities maintains a 'Neutral' on Penn National Gaming (NASDAQ: PENN) price target of $48.00.
Analyst, Harry Curtis, said, "Positives: 1) Toledo results were better than expected; and 2) Charles Town held up better post the opening of Maryland Live!. Negatives: 1) Higher than expected competition at Lawrenceburg (IN), Penn National (PA) and Riverside (MO); 2) Kansas Speedway appears to take longer to ramp; 3) Maryland Live! will add ~1,500 more slots in Oct, which means add’l downside risk to Charles Town; 4) generally softer gaming trends in May and June; and 5) Sioux City contract could be at risk if an agreement is not reached with the City Council of Sioux City &/or the facility’s charitable group (we est. ~$1/sh could be at risk). There is essentially no change to our 2013 EBITDA est. other than for the inclusion of Harrah’s St. Louis casino (purchase expected to close in Q4’12). The FCF aspect of PENN (~$4/sh in 2013) is appealing, but we expect it to be spent on lower ROI projects in OH. PENN’s stock is currently valued at ~7.3x our 2013 EBITDA (assuming $500m OH racetracks are funded from cash on hand), just below its 10-yr avg of ~8x. PENN’s stock is appealing to us and we think it should begin to outperform once investors have greater confidence in a sustainable level of cashflow (once the competing casinos open, which could take another 6 mths). FY 12E EPS from USD 2.51 to USD 2.45; FY 13E EPS from USD 2.76 to USD 2.80."
For an analyst ratings summary and ratings history on Penn National Gaming click here. For more ratings news on Penn National Gaming click here.
Shares of Penn National Gaming closed at $39.79 yesterday.
Analyst, Harry Curtis, said, "Positives: 1) Toledo results were better than expected; and 2) Charles Town held up better post the opening of Maryland Live!. Negatives: 1) Higher than expected competition at Lawrenceburg (IN), Penn National (PA) and Riverside (MO); 2) Kansas Speedway appears to take longer to ramp; 3) Maryland Live! will add ~1,500 more slots in Oct, which means add’l downside risk to Charles Town; 4) generally softer gaming trends in May and June; and 5) Sioux City contract could be at risk if an agreement is not reached with the City Council of Sioux City &/or the facility’s charitable group (we est. ~$1/sh could be at risk). There is essentially no change to our 2013 EBITDA est. other than for the inclusion of Harrah’s St. Louis casino (purchase expected to close in Q4’12). The FCF aspect of PENN (~$4/sh in 2013) is appealing, but we expect it to be spent on lower ROI projects in OH. PENN’s stock is currently valued at ~7.3x our 2013 EBITDA (assuming $500m OH racetracks are funded from cash on hand), just below its 10-yr avg of ~8x. PENN’s stock is appealing to us and we think it should begin to outperform once investors have greater confidence in a sustainable level of cashflow (once the competing casinos open, which could take another 6 mths). FY 12E EPS from USD 2.51 to USD 2.45; FY 13E EPS from USD 2.76 to USD 2.80."
For an analyst ratings summary and ratings history on Penn National Gaming click here. For more ratings news on Penn National Gaming click here.
Shares of Penn National Gaming closed at $39.79 yesterday.
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