Penn National Gaming Misses Where It Counts


Penn National Gaming (NAS: PENN) reported earnings today. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Dec. 31 (Q4), Penn National Gaming met expectations on revenues and missed expectations on earnings per share.

Compared to the prior-year quarter, revenue increased and GAAP earnings per share improved.

Gross margins contracted, operating margins grew, net margins expanded.

Revenue details
Penn National Gaming logged revenue of $676.5 million. The 14 analysts polled by S&P Capital IQ looked for revenue of $677.2 million. Sales were 7.3% higher than the prior-year quarter's $630.2 million.


Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions.

EPS details
EPS came in at $0.41. The 17 earnings estimates compiled by S&P Capital IQ forecast $0.49 per share. GAAP EPS were $0.41 for Q4 versus -$1.97 per share for the prior-year quarter.


Source: S&P Capital IQ. Quarterly periods. Figures may be non-GAAP to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 39.4%, 70 basis points worse than the prior-year quarter. Operating margin was 15.7%, 140 basis points better than the prior-year quarter. Net margin was 6.5%, 3,080 basis points better than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $708.2 million. On the bottom line, the average EPS estimate is $0.57.

Next year's average estimate for revenue is $2.96 billion. The average EPS estimate is $2.26.

Investor sentiment
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 344 members rating the stock outperform, and 31 members rating it underperform. Among CAPS All-Stars (recommendations by the highest-ranked CAPS members), 101 give Penn National Gaming a green thumbs-up, and five give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Penn National Gaming is outperform, with an average price target of $44.56.

At the time thisarticle was published Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor ofMotley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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