Q2 2025 Earnings Release Overview [Management Commentary & Business Highlights](index=1&type=section&id=Management%20Commentary%20%26%20Business%20Highlights) PENN Entertainment's Q2 2025 highlights include solid retail property performance, record Interactive segment gaming revenue driven by product enhancements, and ongoing share repurchases - The Interactive segment generated record gaming revenue, benefiting from product enhancements and the company's omnichannel ecosystem[3](index=3&type=chunk) - Customer demand in the core retail business was stable, with properties not impacted by new supply growing revenue by **nearly 4% year-over-year**[4](index=4&type=chunk) - Omnichannel engagement continues to grow, with online-to-retail player count and theoretical revenue increasing by **8%** and **28% year-over-year**, respectively[4](index=4&type=chunk) - The company is committed to its goal of repurchasing at least **$350 million** of shares in 2025, having already repurchased **$115.3 million** through August 6, 2025[3](index=3&type=chunk) Segment Highlights Q2 2025 | Segment | Metric | Value (in millions) | | :--- | :--- | :--- | | Retail Property Level | Revenues | $1,400.0 | | | Adjusted EBITDAR | $489.6 | | | Adjusted EBITDAR margins | 33.8% | | Interactive | Revenues (incl. tax gross up) | $316.1 | | | Adjusted EBITDA loss | $(62.0) | [Financial Performance Summary](index=4&type=section&id=Financial%20Performance%20Summary) Consolidated revenues grew **6.1%** to **$1.765 billion** in Q2 2025, primarily driven by a **35.9%** increase in the Interactive segment, with net loss improving to **$18.3 million** [Capital Management & Financial Position](index=3&type=section&id=Capital%20Management%20%26%20Financial%20Position) PENN Entertainment maintained a strong liquidity position of **$1.2 billion**, actively managed its capital structure through **$90.3 million** in stock repurchases, and improved its lease-adjusted net leverage ratio to **7.1x** [Detailed Financial Statements](index=7&type=section&id=Detailed%20Financial%20Statements) The unaudited consolidated financial statements detail a net loss of **$18.3 million**, with **$671.6 million** in cash, **$2.8 billion** in total traditional debt, and capital expenditures increasing to **$159.4 million** [Non-GAAP Financial Measures & Reconciliations](index=6&type=section&id=Non-GAAP%20Financial%20Measures%20%26%20Reconciliations) This section defines and reconciles non-GAAP financial measures, including Adjusted EBITDA and Adjusted EBITDAR, to provide insights into operational performance by adjusting for various non-cash and financing-related items Reconciliation of Net Loss to Adjusted EBITDAR (Q2 2025, in millions) | Description | Amount | | :--- | :--- | | Net loss | $(18.3) | | Add back: Income tax expense | $6.4 | | Add back: Interest expense, net | $95.9 | | Other adjustments (D&A, stock comp, etc.) | $152.1 | | **Adjusted EBITDA** | **$236.1** | | Add back: Rent expense associated with triple net operating leases | $156.0 | | **Adjusted EBITDAR** | **$392.1** | - The company defines Adjusted EBITDA as earnings adjusted for interest, taxes, D&A, stock-based compensation, and other specific items, used by management to analyze business performance[30](index=30&type=chunk)[31](index=31&type=chunk) - Adjusted EBITDAR is defined as Adjusted EBITDA plus rent expense from triple-net operating leases, considered a key valuation metric by analysts for gaming companies with such lease structures[32](index=32&type=chunk)[33](index=33&type=chunk) [Appendix](index=11&type=section&id=Appendix) The appendix includes investor conference call logistics, a corporate overview of PENN Entertainment's operations across 28 jurisdictions, and a standard forward-looking statements disclaimer outlining potential future risks

Core Viewpoint - Rush Street Interactive Inc. has demonstrated significant growth in its second-quarter earnings, leading to a notable increase in its stock price, suggesting a positive outlook for the online gaming industry as a whole [1][4][13]. Company Performance - Rush Street's revenue grew by 22% year-over-year, reaching record levels, while EBITDA increased by 88% during the same period [4]. - The growth was driven by a 25% increase in revenue from the online casino segment and a 15% increase from sports betting [4]. - The company reported a year-over-year surge in monthly active users of 30% in North America and 40% in Latin America [6]. - Rush Street remains debt-free with cash reserves of $241 million and has raised its full-year revenue and EBITDA growth guidance to 16% and 51%, respectively [7]. Industry Context - The strong performance of Rush Street may indicate a broader trend of growth within the online gaming sector, particularly as competitors like PENN Entertainment prepare to report their earnings [2][3]. - Advances in AI, user experience, and data-driven personalization are contributing to a favorable environment for online gaming companies [2]. - The recent earnings miss by DraftKings raises questions about whether Rush Street's success is indicative of a broader industry trend or specific to the company itself [15]. Analyst Sentiment - Analysts are generally bullish on Rush Street, with eight out of ten rating it a Buy, despite the stock price exceeding the consensus price target of around $18 per share [7]. - The stock forecast suggests a potential downside of 8.61% from the current price of $19.58, with a 12-month price target of $17.89 [5][6].

Core Viewpoint - Wall Street analysts anticipate PENN Entertainment will report a quarterly loss of -$0.04 per share, reflecting a year-over-year increase of 77.8%, with revenues expected to reach $1.73 billion, up 4.3% from the previous year [1]. Earnings Estimates - Over the past 30 days, the consensus EPS estimate has been revised downward by 8.6%, indicating a collective reassessment by analysts [2]. - Revisions to earnings projections are crucial for predicting investor behavior and are strongly correlated with short-term stock price performance [3]. Revenue Projections - Analysts predict the 'Revenues- West segment' will be $134.80 million, a decrease of -0.4% year-over-year [5]. - The 'Revenues- Interactive segment' is expected to reach $303.10 million, indicating a significant increase of +30.3% year-over-year [5]. - The 'Revenues- Midwest segment' is forecasted at $297.94 million, showing a slight decrease of -0.1% from the previous year [5]. - The 'Revenues- Northeast segment' is estimated to be $707.63 million, reflecting a +1.6% change year-over-year [6]. - The 'Revenues- South segment' is projected at $298.81 million, indicating a +0.2% change from the prior year [6]. - The 'Revenues- Other segment' is expected to be $6.10 million, showing a +3.4% increase year-over-year [6]. Adjusted EBITDAR Estimates - The 'Adjusted EBITDAR- Midwest segment' is estimated at $124.57 million, down from $129.90 million reported in the same quarter last year [7]. - The 'Adjusted EBITDAR- West segment' is forecasted to be $50.17 million, slightly lower than the $50.60 million reported in the previous year [7]. - The 'Adjusted EBITDAR- South segment' is expected to be $109.24 million, down from $111.40 million reported last year [8]. - The 'Adjusted EBITDAR- Northeast segment' is projected at $203.58 million, compared to $204.70 million reported in the same quarter last year [8]. Stock Performance - PENN Entertainment shares have experienced a -5% return over the past month, contrasting with a +0.5% change in the Zacks S&P 500 composite [8].

Group 1 - PENN Entertainment is expected to report a year-over-year increase in earnings, with a projected quarterly loss of $0.04 per share, reflecting a change of +77.8% [3][12] - Revenues for PENN are anticipated to be $1.73 billion, which is a 4.3% increase from the same quarter last year [3] - The consensus EPS estimate has been revised 8.61% lower over the last 30 days, indicating a reassessment by analysts [4] Group 2 - The Zacks Earnings ESP for PENN is +23.32%, suggesting a bullish outlook from analysts regarding the company's earnings prospects [12] - The stock currently holds a Zacks Rank of 3, indicating a hold position [12] - Historically, PENN has beaten consensus EPS estimates three out of the last four quarters, with a recent surprise of +13.79% [13][14] Group 3 - Super Group (SGHC) Limited, another player in the gaming industry, is expected to report earnings per share of $0.13, representing a year-over-year change of +62.5% [18] - Revenues for Super Group are projected to be $503 million, up 12.7% from the previous year [18] - The consensus EPS estimate for Super Group has been revised 16.7% lower over the last 30 days, with an Earnings ESP of 0% [19]

Group 1 - PENN Entertainment is showing a bullish trend as it has crossed above the 20-day moving average, indicating a potential upward movement in stock price [1][2] - The stock has gained 5.2% over the past four weeks, suggesting positive momentum [4] - There have been five upward revisions in earnings estimates for the current fiscal year, with no downward revisions, reinforcing the bullish outlook [4][5] Group 2 - The Zacks Rank for PENN is currently 3 (Hold), indicating that the stock may continue to rise [4] - The combination of positive earnings estimate revisions and technical indicators suggests that investors should monitor PENN for potential gains [5]

Group 1 - PENN Entertainment (PENN) has surpassed resistance at the 200-day moving average, indicating a long-term bullish trend [1] - The stock has moved 5.2% higher over the last four weeks, suggesting potential for further rallies [2] - There have been 5 upward revisions in earnings estimates for the current fiscal year, with no downward revisions, reinforcing the bullish outlook [3] Group 2 - The 200-day simple moving average is a key technical indicator that helps determine long-term market trends and serves as a support or resistance level [2] - PENN is currently rated as a Zacks Rank 3 (Hold), indicating a neutral stance on the stock [2] - The positive movement in earnings estimate revisions adds to the case for investors to consider adding PENN to their watchlist [3]

Core Insights - Vornado Realty Trust, Inc. (VNO) has successfully completed a refinancing of $450 million for its Manhattan office building, PENN 11, which spans 1.2 million square feet [1][8] Group 1: Refinancing Details - The new five-year interest-only loan has a fixed interest rate of 6.35% and is set to mature in August 2030 [2][8] - Vornado repaid $50 million of its previous $500 million loan, which had an interest rate of SOFR plus 2.06% (swapped to a fixed rate of 6.28%) and was due to mature in October 2025 [2][8] Group 2: Financial Implications - This refinancing enhances Vornado's financial flexibility, improving its maturity profile and providing greater liquidity for daily operations [3][8] - As of March 31, 2025, Vornado had $2.3 billion in liquidity, which includes $807 million in cash and cash equivalents, and $1.5 billion available under its $2.2 billion revolving credit facilities [4] Group 3: Market Performance - Over the past three months, Vornado's shares have increased by 13.8%, outperforming the industry growth of 3.2% [5]

Core Insights - Zacks Premium offers various tools for investors to enhance their stock market strategies and confidence [1] - The Zacks Style Scores are designed to complement the Zacks Rank, helping investors identify stocks likely to outperform the market in the short term [2] Zacks Style Scores Overview - Stocks are rated from A to F based on value, growth, and momentum characteristics, with higher scores indicating a better chance of outperforming the market [3] - The Style Scores are categorized into four types: Value Score, Growth Score, Momentum Score, and VGM Score, each focusing on different investment strategies [3][4][5][6] Value Score - The Value Score identifies attractive and discounted stocks using various financial ratios such as P/E, PEG, and Price/Sales [3] Growth Score - The Growth Score assesses a company's financial health and future outlook by analyzing projected and historical earnings, sales, and cash flow [4] Momentum Score - The Momentum Score helps investors capitalize on price trends, utilizing factors like one-week price changes and monthly earnings estimate changes [5] VGM Score - The VGM Score combines the three Style Scores to identify companies with the best value, growth potential, and momentum [6] Zacks Rank Integration - The Zacks Rank is a proprietary model based on earnings estimate revisions, with 1 (Strong Buy) stocks achieving an average annual return of +23.62% since 1988, significantly outperforming the S&P 500 [7][8] - To maximize returns, investors should focus on stocks with a Zacks Rank of 1 or 2 and Style Scores of A or B [9] Company Spotlight: PENN Entertainment - PENN Entertainment, established in 1982, is a leading operator of gaming and racing facilities, with a diverse portfolio [11] - Currently rated 3 (Hold) by Zacks, PENN has a VGM Score of A and a Momentum Style Score of A, with shares increasing by 5.3% over the past four weeks [12] - Analysts have revised PENN's earnings estimate upwards, with the Zacks Consensus Estimate rising from $0.65 to $0.69 per share, and the company has an average earnings surprise of +13.5% [12][13]

Company Overview - PENN Entertainment, incorporated in Pennsylvania in 1982, is a leading multi-jurisdictional owner and manager of gaming and racing facilities, focusing on slot machine entertainment [12] - The company has a geographically widespread portfolio and operates video gaming terminal operations [12] Zacks Rank and Style Scores - PENN is currently rated 3 (Hold) on the Zacks Rank, indicating a neutral outlook [13] - The company has a VGM Score of B, reflecting a combination of value, growth, and momentum characteristics [13] - PENN's Value Style Score is also B, supported by attractive valuation metrics such as a forward P/E ratio of 25.8, which may appeal to value investors [13] Earnings Estimates and Performance - In the last 60 days, five analysts have revised their earnings estimates for PENN upwards, with the Zacks Consensus Estimate increasing from $0.65 to $0.69 per share for fiscal 2025 [13] - PENN has demonstrated an average earnings surprise of +13.5%, indicating a history of exceeding earnings expectations [13] Investment Consideration - With a solid Zacks Rank and strong Value and VGM Style Scores, PENN is suggested to be on investors' short lists for potential investment opportunities [14]

Group 1 - PENN Entertainment Inc shares have increased by 9%, reaching $19.20, the highest level since early March, following an upgrade from Citizens JMP from "market perform" to "outperform" with a price target of $24 [1] - The stock has been recovering from an early-April low of $13.25 and is now approaching its year-over-year breakeven level, with analysts evenly split on ratings [2] - There has been a 5.6% increase in short interest over the past two reporting periods, now accounting for 13.4% of the stock's total float, indicating a potential for short covering [3] Group 2 - The average trading pace suggests it would take shorts five days to buy back their positions, indicating a potential shift in market sentiment [3] - Options for PENN Entertainment are currently considered affordable, with a Schaeffer's Volatility Index (SVI) of 44%, ranking in the 3rd percentile of its annual range, suggesting low volatility expectations [3]