Penn National Gaming Crushes Earnings Estimates

Seth Jayson, The Motley Fool
Updated

Penn National Gaming (NAS: PENN) reported earnings on April 19. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended March 31 (Q1), Penn National Gaming beat expectations on revenues and crushed expectations on earnings per share.

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


Margins increased across the board.

Revenue details
Penn National Gaming reported revenue of $736.1 million. The 17 analysts polled by S&P Capital IQ expected revenue of $704.4 million on the same basis. GAAP reported sales were 10% higher than the prior-year quarter's $667.0 million.

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Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
Non-GAAP EPS came in at $0.73. The 21 earnings estimates compiled by S&P Capital IQ anticipated $0.59 per share on the same basis. GAAP EPS of $0.74 for Q1 were 54% higher than the prior-year quarter's $0.48 per share.

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Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 41.9%, 30 basis points better than the prior-year quarter. Operating margin was 18.9%, 80 basis points better than the prior-year quarter. Net margin was 10.7%, 300 basis points better than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $726.7 million. On the bottom line, the average EPS estimate is $0.62.

Next year's average estimate for revenue is $2.90 billion. The average EPS estimate is $2.27.

Investor sentiment
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 337 members out of 368 rating the stock outperform, and 31 members rating it underperform. Among 105 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 100 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 $45.44.

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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