A Fresh Look at PENN Entertainment (PENN) Valuation Following Strategic Digital Pivot and Kambi Extension

PENN Entertainment (PENN) just announced an extension of its partnership with Kambi Group for its retail sportsbook platform, securing operations through July 2027. At the same time, PENN is pivoting its digital focus away from ESPN BET and focusing on growing its iCasino and theScore Bet brands.

See our latest analysis for PENN Entertainment.

The news follows a stretch of high-profile changes for PENN Entertainment, including a strategic board shift and its more recent digital pivot. Despite a 1.1% boost in share price in the past day and a 6.7% gain for the week, momentum remains weak. The stock has posted a year-to-date share price return of -23.4% and a one-year total shareholder return of -31.8%. In short, the pressure on PENN’s share price suggests investors are still waiting to see if these moves jumpstart a turnaround.

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So with PENN shares still trading at a notable discount to analyst price targets and the business making big strategic moves, is the stock now undervalued, or is the market already pricing in all future growth?

Most Popular Narrative: 25% Undervalued

PENN Entertainment’s most widely followed narrative places its fair value at $19.67, compared to a last close of $14.73. The gap suggests high expectations for a rebound as the company pivots toward digital growth and ongoing strategic overhauls.

Deepening integration with the ESPN digital ecosystem, including new features like FanCenter and account linking with ESPN Fantasy and the direct-to-consumer streaming platform, positions PENN to reach a larger, younger, and highly engaged sports-centric audience. This is likely to accelerate user acquisition, drive double-digit revenue growth, and improve overall market share in both online sports betting (OSB) and iCasino, supporting future top-line growth.

Read the complete narrative.

Want to see the revenue engine fueling this bullish price target? The narrative is built around an aggressive shift in profit margins and a dramatic change in future earnings. What’s driving the analysts’ optimism, and can PENN really break away from the pack? Explore what sets this story apart from the usual casino stock playbook.

Result: Fair Value of $19.67 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, persistent struggles in PENN’s digital business and mounting pressure from new gaming competition could quickly cloud the current outlook for shares.

Find out about the key risks to this PENN Entertainment narrative.

Build Your Own PENN Entertainment Narrative

If you see a different future for PENN or want to dig into the numbers yourself, you can lay out your own story in just a few minutes, then Do it your way

A good starting point is our analysis highlighting 3 key rewards investors are optimistic about regarding PENN Entertainment.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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