PENN Entertainment (PENN) Top Third Quarter Earnings and Revenue Estimates

PENN Entertainment, Inc. PENN reported Q3 2023 earnings and revenue that beat the Zacks Consensus Estimate. Quarterly earnings increased, but revenue declined year-over-year.

Following the results, the company’s shares rose 14% during trading hours on November 2.

Discussion of earnings and revenue

During the quarter under review, PENN reported adjusted earnings per share (EPS) of $1.21, beating the Zacks’ consensus estimate of 33 cents by 266.7%. In the year-ago quarter, it reported adjusted earnings per share of 72 cents.

Total revenue of $1,619.4 million beat the Zacks Consensus Estimate of $1,606 million. The top line was down 0.3% year-on-year. Mildness in the southern and western regions led to the decline.

The Northeast segment brought in $687 million in revenue, up from $685.4 million a year ago. Our model predicts that the metric will rise 5.8% year over year to $725.2 million. Revenues from the South, West and Midwest segments were $308.2 million, $135.1 million and $293.4 million, respectively, down 6.5%, 13.7% and 1.7% from the prior year.

Interactive and Other segment revenues were $196.3 million and $4.5 million, respectively, up 23.7% and 7.1% over the prior year.

PENN Entertainment, Inc. Price, Consensus and EPS surprise

PENN Entertainment, Inc. price-consensus-eps-surprise-chart | PENN Entertainment, Inc. Quote

Operational Headings

In the quarter under review, adjusted EBITDAR decreased 5.7% from the prior quarter to $445.1 million. Our model suggested the metric would fall by 4.5% over the year. Adjusted EBITDAR margin contracted 150 basis points to 27.5%.

Other financial information

As of September 30, 2023, the company had cash and cash equivalents of $1,317.9 million compared to $1,624 million as of December 31, 2022. Traditional net debt as of September 30, 2023 was $1,344.1 million compared to $1,075.8 million dollars at the end of 2022. The company’s total liquidity as of September 30, 2023 was $1.3 billion.

Zacks Rank and Key Picks

PENN Entertainment currently has a Zacks Rank #3 (Hold).

Live Nation Entertainment, Inc. LYV has a Zacks Rank #1 (Strong Buy). There is a surprise for the last four quarters of earnings of an average of 34.6%. LYV shares are down 3.8% over the past year. You can see the full list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for LYV’s 2023 sales and EPS shows year-over-year growth of 21.6% and 59.4%, respectively.

AMC Entertainment Holdings, Inc. AMC boasts a Zacks Rank #1. AMC has an earnings surprise over the last four quarters of an average of 44.2%. The stock has lost 32.9% over the past year.

The Zacks Consensus Estimate for AMC’s 2024 sales and EPS suggests year-over-year improvements of 19.5% and 72.8%, respectively.

OneSpaWorld Holdings Limited OSW has a Zacks Rank #1. OSW has an earnings surprise over the last four quarters of an average of 42.6%. Shares of OSW are up 10.1% over the past year.

The Zacks Consensus Estimate for OSW’s 2023 sales and EPS suggests an advance of 44.5% and 117.9%, respectively, from year-ago levels.

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The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.

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