Penn Entertainment Analysts On 'Landscape-Changing' Sports Betting Deal With ESPN: 'This Move Makes Sense'
Portfolio Pulse from Chris Katje
Penn Entertainment (NASDAQ:PENN) has announced a partnership with ESPN, along with its Q2 earnings and the divestiture of Barstool Sports. Analysts have mixed views on the deal, with some seeing it as a 'landscape-changing' move, while others are more cautious due to previous failed partnerships in the sector. The deal could lead to more consolidation in the sports betting industry and increase the total addressable market size. Penn is paying $1.5 billion over 10 years, $500 million in warrants, and additional warrants based on market share targets. The impact on DraftKings (NASDAQ:DKNG) is seen as minimal.
August 09, 2023 | 3:28 pm
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POSITIVE IMPACT
The deal could potentially create a new revenue stream for Disney, making its stock a bargain.
The deal could potentially create a new revenue stream for Disney, making its stock a bargain.
CONFIDENCE 70
IMPORTANCE 70
RELEVANCE 60
NEUTRAL IMPACT
Caesars Entertainment has a 5% market share in the online sports betting sector, indicating potential competition for Penn.
Caesars Entertainment has a 5% market share in the online sports betting sector, indicating potential competition for Penn.
CONFIDENCE 70
IMPORTANCE 60
RELEVANCE 40
NEUTRAL IMPACT
The impact on DraftKings is seen as minimal due to its strong product, brand, and customer acquisition efficiencies.
The impact on DraftKings is seen as minimal due to its strong product, brand, and customer acquisition efficiencies.
CONFIDENCE 70
IMPORTANCE 60
RELEVANCE 60
NEUTRAL IMPACT
Penn's partnership with ESPN could potentially increase its market share in the sports betting sector. However, the success of the deal is not guaranteed due to previous failed partnerships.
The partnership could potentially increase Penn's market share and lead to more consolidation in the sports betting industry. However, the success of the deal is not guaranteed due to previous failed partnerships.
CONFIDENCE 70
IMPORTANCE 80
RELEVANCE 100
NEGATIVE IMPACT
Comcast's partnership with PointsBet did not gain significant traction, indicating potential challenges for Penn's partnership with ESPN.
Comcast's partnership with PointsBet did not gain significant traction, indicating potential challenges for Penn's partnership with ESPN.
CONFIDENCE 70
IMPORTANCE 60
RELEVANCE 40