What happened
Shares of Penn National Gaming (PENN 2.35%), a casino operator that also offers online gaming and sports betting, were volatile today after the company announced earnings results for the fourth quarter and full year of 2021.
Penn erased losses in pre-market trading, saw shares rise as much as 12% around 9:40 a.m. ET today, but then saw those gains disappear as it traded about 1% higher as of 12:50 p.m. ET.
So what
The company reported diluted earnings per share (EPS) of $0.26 on total revenue of $1.57 billion. EPS missed analyst estimates by nearly 50%, while revenue topped estimates.
Image source: Getty Images.
In its earnings report, Penn also provided guidance for 2022. Management says it expects to generate net revenue between $6.07 billion and $6.39 billion, and adjusted earnings before interest, taxes, depreciation, amortization, and restructuring or rent costs (EBITDAR) between $1.85 billion and $1.95 billion.
Penn also announced that its board of directors has authorized a three-year stock buyback program of $750 million.
Now what
Although the company missed on EPS again, analysts seemed optimistic about Penn's interactive segment, which includes its social gaming businesses, Barstool Sportsbook, and its recently acquired digital sports media and betting app, theScore.
Penn CEO Jay Snowden said the segment operated better than expected in the fourth quarter, despite investing in growing the business. He also said the outlook for the segment in 2022 is better than previously anticipated.
Analysts at Stifel (NYSE: SF) are reported to have said they don't think the online sports gaming and betting businesses are being fairly penciled into the company's current valuation. Considering Penn seems to be heavily investing and growing this digital segment, that would certainly be a good sign for the stock.
