JPMorgan selected Penn Entertainment as a top pick in the gaming sector. Analyst Daniel Politzer initiated research coverage of the gambling stock with an overweight rating and a $24 price target that suggests the regional casino operator can climb 41% from Friday's closing price. "PENN is appealing for capital allocation (buying back ~14% of market cap over next 6 months) and growth prospects (via new land-based casino projects/openings)," Politzer said in a note to clients. Politzer said the company has an attractive path to future profits. Its $1 billion worth of new projects set to open over the next two years can help lift analysts' earnings estimates, he said. Politzer also pointed to improvements in free cash flow and the company's balance sheet. He said Penn is looking at funding $325 million of remaining stock buybacks in 2025. Additionally, the analyst said he sees value in what he called lucrative market access fees from Penn. He also said improvements in regional casino fundamentals can provide a boost. Through Friday, the stock had dropped 14% in 2025, on pace for its fifth down year in a row. Shares in Penn, which runs 43 properties in 20 states, including the L'Auberge Casino in Lake Charles, Louisiana, and Hollywood Casino Gulf Coast in Mississippi, are 80% lower than their close at the end of 2020. PENN YTD mountain Penn Entertainment, year to date Politzer listed Red Rock Resorts and Caesars Entertainment as his other best ideas. He also has overweight ratings on Churchill Downs and DraftKings .
