WYOMISSING, PA (Jan. 29, 2020) – Penn National Gaming, Inc. (PENN: Nasdaq) (“Penn National” or the “Company”) announced today that it has entered into an agreement to acquire a 36% interest in Barstool Sports, Inc. (“Barstool Sports”), a leading digital sports media company, for approximately $163 million in cash and convertible preferred stock. Penn National Gaming’s Barstool Sportsbook attracted plenty of attention recently by reporting a hold percentage around 20% from Pennsylvania customers in December, and it didn’t escape the.
Penn National Gaming, Inc. PENN recently announced plans for the opening of Barstool sportsbook at Greektown Casino Hotel and rebranded Barstool sportsbook at Hollywood Casino Lawrenceburg on Dec 23, 2020. It also expects to open Barstool sportsbook at Ameristar East Chicago Casino & Hotel on Dec 24. However, the openings are subject to final regulatory approvals.
Notably, the Sportsbook comprises sports viewing area, redesigned dining space, betting counter (featuring large odds boards), numerous sports betting kiosks and ticket writer stations to support multiple sports wagering options. It also allows customers to earn tier points and mycash using the company’s myChoice loyalty program.
In this regard, Rafael Verde, senior vice president of Regional Operations for Penn National, stated, “The new designs incorporate the spirit of the Barstool Sports brand, resulting in unique sports wagering and dining experiences that we expect our customers will thoroughly enjoy.”
Increased Focus on Barstool Sports Partnership
In February 2020, Penn National had reached an agreement to acquire 36% interest in Barstool Sports for nearly $163 million. Per the agreement, Penn National will be Barstool Sports, a leading digital sports media company’s gaming partner. Moreover, the partnership provides Penn National with access to a database of 66 million sports enthusiasts (or Barstool loyalist), out of which 60% are into sports betting while the remaining are avid betters.
During third-quarter 2020, the company unveiled Barstool Sports online sports betting app in Pennsylvania. Within the first two weeks of launch, the company acquired a significant number of new customers on the back of higher promotional allowances.
Barstool Sportsbook Illinois
Going forward, the company plans to launch standalone Barstool branded entertainment destinations, thereby acting as a virtual sports books where sports betting is allowed. It also plans to launch Barstool Sportsbook app and new iCasino products in Michigan, pending final regulatory approval.
Price Performance
Barstool Sportsbook Penn National Racing
© Provided by Zacks.comComing to price performance, shares of Penn National have surged 274.5% so far this year, compared with the industry’s 6.9% growth. The outperformance can be primarily attributed to the company’s expansion initiatives and cost-saving efforts. Going forward, the company remains confident about its long-term prospects on the back of its differentiated omni-channel approach. Also, partnership with Barstool Sports is likely to drive revenues during the upcoming periods. Meanwhile, earnings estimates for 2021 have moved up in the past 30 days, depicting analysts’ optimism regarding the stock’s growth potential.
However, the coronvirus pandemic has dramatically reduced travel and demand for casino gaming and related amenities. If the virus is not contained, further chances of temporary suspension of operations cannot be ruled out.
Penn National— which shares space with Caesars Entertainment Corporation CZR, MGM Resorts International MGM and Red Rock Resorts, Inc. RRR in the Zacks Gaming industry — has a Zacks Rank #3 (Hold) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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Launch to Include Fundraiser for the Barstool Fund to SupportMichigan Small Businesses Impacted by the COVID-19 Pandemic
Penn National Gaming, Inc. (Nasdaq: PENN) (“Penn National” orthe “Company”) announced today that the Michigan Gaming ControlBoard (“MGCB”) has approved the Company’s applications to offeronline sports wagering and iCasino products in Michigan. PennNational intends to officially launch its Barstool Sportsbookmobile app on iOS and android, as well as desktop at 12:00pm EST onFriday, January 22, 2021 and its iCasino products will followshortly thereafter, subject to final regulatory approvals. Thisfollows the opening of the Company’s retail Barstool Sportsbook atGreektown Casino Hotel (“Greektown”) in downtown Detroit onDecember 23, 2020.
“This is an exciting time to be launching our online BarstoolSportsbook in Michigan,” said Jay Snowden, President and CEO ofPenn National. “We have been incredibly pleased with the success ofthe mobile app since launching in Pennsylvania in September. Ourcustomers have thoroughly enjoyed engaging with Dave Portnoy, Dan‘Big Cat’ Katz and other Barstool fan favorites, and we expect moreof the same in Michigan. As the only gaming operator with a fullyintegrated sports media and entertainment partner, Penn can provideour customers the opportunity to interact with Barstoolpersonalities online and also in-person at our new BarstoolSportsbook at Greektown.”
During the opening weekend of the Barstool Sportsbook, PennNational will be partnering with Barstool Sports on a fundraiser tosupport Michigan small businesses impacted by COVID-19. From thehours of 12:00pm on Friday, January 22 to 11:59pm on Sunday,January 24, Michigan residents will have their first-time depositon the Barstool Sportsbook mobile app matched with a donation toThe Barstool Fund provided they wager equal or more than theirfirst-time deposit during the weekend. The Barstool Fund wasstarted by Mr. Portnoy in December to raise money to sustain smallbusinesses around the country that have been hard hit by theongoing pandemic. In addition, visitors to the retail BarstoolSportsbook at Greektown will have their first-time rated wagermatched by Greektown Casino with a donation to Fund.
“We’re proud to be able to support those small businessesimpacted by COVID-19 as part of our opening plans,” said Mr.Snowden. “I also want to thank the MGCB and its staff for theirtime and effort in reviewing and approving our applications. Inaddition, I want to thank our team at Penn Interactive, our greatpartners at Barstool Sports, and our risk management and platformproviders, Kambi and White Hat Gaming, for their many months ofhard work and collaboration. We’re off to a fast start in 2021 andlook forward to continuing our Company’s evolution into the leadingomni-channel provider of retail and online gaming, live racing andsports betting entertainment,” concluded Mr. Snowden.
About Penn National Gaming
With the nation's largest and most diversified regional gamingfootprint, including 41 properties across 19 states, Penn Nationalcontinues to evolve into a highly innovative omni-channel providerof retail and online gaming, live racing and sports bettingentertainment. The Company's properties feature approximately50,000 gaming machines, 1,300 table games and 8,800 hotel rooms,and operate under various well-known brands, including Hollywood,Ameristar, and L'Auberge. Our wholly-owned interactive division,Penn Interactive, operates retail sports betting across theCompany's portfolio, as well online social casino, bingo, andiCasino products. In February 2020, Penn National entered into astrategic partnership with Barstool Sports, whereby Barstool isexclusively promoting the Company's land-based and online casinosand sports betting products, including the Barstool Sportsbookmobile app, to its national audience. The Company's omni-channelapproach is bolstered by the mychoice loyalty program, whichrewards and recognizes its over 20 million members for theirloyalty to both retail and online gaming and sports bettingproducts with the most dynamic set of offers, experiences, andservice levels in the industry.
About Barstool Sports
Founded in 2003 by David Portnoy, Barstool Sports is a leadingdigital sports, entertainment and media platform that deliversoriginal content across blogs, podcasts, radio, video and social,supported by nearly 70 dedicated personalities. It benefits fromits base of loyal monthly unique visitors, including an estimated48% of males and 44% of females in the Millennial and Generation Xgenerations across the United States. In 2019, Barstool Sports grewby approximately 65%, delivering nearly $100 million in revenuefrom digital and audio advertising, ecommerce, events, licensingand subscription.
Forward-Looking Statements
This press release contains “forward-looking statements” withinthe meaning of the Private Securities Litigation Reform Act of1995. These statements can be identified by the use offorward-looking terminology such as “expects,” “believes,”“estimates,” “projects,” “intends,” “plans,” “goal,” “seeks,”“may,” “will,” “should,” or “anticipates” or the negative or othervariations of these or similar words, or by discussions of futureevents, strategies or risks and uncertainties. Such statements areall subject to risks, uncertainties and changes in circumstancesthat could significantly affect the Company’s future financialresults and business. Accordingly, the Company cautions that theforward-looking statements contained herein are qualified byimportant factors that could cause actual results to differmaterially from those reflected by such statements. Such factorsinclude, but are not limited to, risks related to the following:(a) the magnitude and duration of the impact of the COVID-19pandemic on capital markets, general economic conditions,unemployment, consumer spending and the Company’s liquidity,financial condition, supply chain, operations and personnel; (b)the launch of the Barstool Sportsbook app is subject to regulatoryapprovals, which may be delayed; (c) the impact of significantcompetition from other companies for online sports betting; (d) theCompany’s ability to achieve the expected financial returns relatedto its Barstool Sportsbook app; (e) the risk of failing to maintainthe integrity of the Company’s information technologyinfrastructure and safeguard its business, employee and customerdata in connection with the Company’s online sports betting; (f)the Company’s and its business partners’ ability to obtain variousregulatory approvals required to own, develop and/or operate theBarstool Sportsbook app may be delayed or may not occur; and (g)other factors included in “Risk Factors” of the Company’s AnnualReport on Form 10-K for the year ended December 31, 2019, theCompany’s Quarterly Reports on Form 10-Q for the quarters endedMarch 31, 2020, June 30, 2020 and September 30, 2020, subsequentQuarterly Reports on Form 10-Q and Current Reports on Form 8-K,each as filed with the U.S. Securities and Exchange Commission. TheCompany does not intend to update publicly any forward-lookingstatements except as required by law. In light of these risks,uncertainties and assumptions, the forward-looking events discussedin this press release may not occur.
View sourceversion on businesswire.com:https://www.businesswire.com/news/home/20210119005952/en/
Eric Schippers
Senior Vice President, Public Affairs
Penn National Gaming
610/373-2400
Joseph N. Jaffoni, Richard Land
JCIR
212/835-8500 or penn@jcir.com