Analyst: Penn may have advantage in new markets

Apr 3, 2009 6:36 PM
Staff & Wire Reports |

Penn National Gaming Inc. will likely be able to take advantage of some of the new and potential gambling markets, an analyst said Friday, as rivals are not as well capitalized.

Steven Wieczynski of Stifel Nicolaus & Co. predicts the casino operator could enter markets such as Texas, Florida, New Hampshire and Massachusetts. The Wyomissing, Pa.-based company has already proposed developments for Maryland, Kansas and Ohio, which are dependent on gaming legislation approval.

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"With other operators deleveraging and in a tight capital environment we believe (Penn) will be able to build more basic, less expensive properties that could still generate solid returns," Wieczynski wrote in a client note.

The analyst reaffirmed a "Buy" rating and $27 price target.

Penn National Gaming's stock fell $1.44, or 5.2 percent, to $26.13 as the broader market declined on a Labor Department report that indicated the unemployment rate jumped to 8.5 percent last month.