PENN Entertainment nominates two HG Vora candidates to board

WYOMISSING, Pa. - PENN Entertainment, Inc. (NASDAQ:PENN), a leading provider of integrated entertainment, sports content, and casino gaming experiences in North America, has announced the nomination of two candidates proposed by HG Vora Capital Management, LLC, for election to its Board of Directors. According to InvestingPro data, PENN currently maintains a market capitalization of $2.35 billion, though its overall financial health score is rated as WEAK, suggesting potential challenges ahead. This move comes as part of the company’s ongoing engagement with HG Vora and reflects PENN’s commitment to its shareholders and strategic growth.

The company has been actively transforming its business model to focus on digital engagement and growth, capitalizing on the shift towards online experiences in the industry. PENN’s omni-channel strategy has been aimed at leveraging both its digital and retail presence to reach new and existing customers, driving growth and profitability. This transformation comes as the company faces significant financial challenges, with InvestingPro analysis revealing a substantial debt burden of $11 billion and negative earnings per share of -$0.56 over the last twelve months. However, analysts project a return to profitability this year, with forecasted earnings of $0.93 per share. The strategy has led to a significant increase in the company’s loyal customer base, with PENN Play loyalty members exceeding 32 million, a 10% year-over-year growth.

PENN’s retail operations continue to show strength, with 14 of 17 regional markets reporting year-over-year market share growth in Q1 2025. The company’s adjusted EBITDA margins have been industry-leading, and it has maintained robust cash flow generation from its diverse geographical portfolio of 42 properties across 19 states.

In the digital space, PENN’s Interactive segment has been gaining momentum and is on track to achieve profitability by the fourth quarter of 2025. The segment has seen a substantial increase in customer acquisition and revenue growth, particularly since the launch of ESPN BET in November 2023.

In terms of capital allocation, PENN has emphasized a disciplined approach, ending Q1 2025 with $1.5 billion in liquidity and plans to accelerate the return of capital to shareholders, including a commitment to repurchase at least $350 million of common stock in 2025. InvestingPro analysis indicates the stock is currently trading near its Fair Value, with revenue growing at 5.51% year-over-year and an EBITDA of $659 million. For deeper insights into PENN’s valuation and 10+ additional ProTips, including detailed financial analysis and expert recommendations, investors can access the comprehensive Pro Research Report available on InvestingPro.

As part of its shareholder engagement efforts, PENN has held extensive discussions with HG Vora, including over 25 meetings and calls. After considering HG Vora’s three nominees, the company has chosen to nominate Johnny Hartnett and Carlos Ruisanchez to its Board, acknowledging their potential contributions to PENN’s growth. The decision was made following a comprehensive evaluation process and in adherence to regulatory requirements.

The company has also addressed concerns regarding HG Vora’s previous proposals and regulatory compliance, emphasizing the importance of acting in accordance with state gaming laws and the best interests of all shareholders.

PENN’s Board refreshment initiative, which began in 2020, continues to focus on identifying candidates with relevant expertise, particularly in the digital domain. With the upcoming Annual Meeting in June 2025, the Board expects that 75% of directors will have joined since 2019, reflecting the company’s commitment to board refreshment and strategic oversight.

This announcement is based on a press release statement from PENN Entertainment, Inc.

In other recent news, PENN Entertainment has reported its financial results for the first quarter of 2025, revealing a miss on both earnings and revenue expectations. The company posted an earnings per share (EPS) of -$0.25, falling short of the forecasted -$0.19, while revenue came in at $1.67 billion against a $1.71 billion forecast. Despite these setbacks, PENN’s retail segment demonstrated resilience, generating $1.4 billion in revenue, and the Interactive division showed year-over-year improvements in EBITDA losses. Analysts from Mizuho and Macquarie both adjusted their price targets for PENN Entertainment to $24, maintaining an Outperform rating. Mizuho noted a strong year-over-year EBITDA increase in PENN’s interactive segment, while Macquarie highlighted a 28% increase in first-quarter EBITDAR despite falling short of consensus estimates. The company is also progressing with development projects, including a new Hollywood Casino in Iowa, set to replace an existing riverboat casino. Management remains optimistic about future performance, with plans to expand digital offerings through partnerships and new market opportunities.

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