PENN Entertainment Stock Soars 17% Amid Insider Buying
One of the top gambling and online sportsbook stocks, PENN Entertainment (NASDAQ:), has experienced a significant surge in its stock price this week, climbing approximately 17% since Wednesday, with an additional 8% jump on Friday, reaching around $20 per share. But what exactly is driving this upward momentum?
Insider Buying Lifts Stock Price
Recent insider activity within the company has played a key role in boosting PENN Entertainment’s stock price. Over the past few weeks, several company executives have been actively acquiring shares of the company:
- CEO Jay Snowden purchased 54,300 shares at $18.44 per share, totaling a $999,448 stake.
- Director Anuj Dhanda bought 15,000 shares at $18.40 per share, amounting to a $276,000 stake.
- Director David Handler acquired 10,000 shares at $17.51 per share, resulting in a $175,000 stake.
Insider buying is often viewed as a positive sign, indicating that company leadership believes in the value and future prospects of the stock. This could be due to expectations of increased revenue from the NFL season, potential upcoming investments, partnerships, or acquisitions that may boost the stock price.
In addition to insider activity, PENN Entertainment recently launched ESPN Bet in New York, a significant market for sports betting, which could lead to immediate revenue growth.
Should You Buy PENN Stock?
While analysts have set a median price target of $21.50 for PENN Entertainment stock, with most rating it as a sell, the insider buying activity is worth noting for investors. The company has been making strides towards profitability, especially with its entry into the New York sports betting market. However, it still faces challenges in standing out in a competitive landscape, despite its association with ESPN.
Although PENN Entertainment has not been profitable in recent quarters, its low price-to-sales ratio suggests that it may be undervalued. The stock is down 24% year-to-date, but the recent positive momentum and insider buying could indicate a potential turnaround.
While PENN Entertainment stock may not be a clear buy at the moment, it certainly warrants further observation. The recent insider activity and growth opportunities in the sports betting market make it a stock to watch closely.
Source: ValueWalk
Analysis:
The surge in PENN Entertainment stock price, driven by insider buying and new market opportunities, signifies a potential turnaround for the company. While analysts remain cautious, the recent positive developments and growth prospects make it a stock worth monitoring. For investors, paying attention to insider activity and market trends could provide valuable insights into the stock’s future performance.