Penn National Gaming Stock Pops After Jefferies Bull Note

PENN is just a few days removed from its annual lows

Digital Content Manager
May 18, 2022 at 9:15 AM
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The shares of Penn National Gaming, Inc (NASDAQ:PENN) are up 2.5% at $31.69 this morning after Jefferies upgraded the casino concern to "buy" from "hold." The analyst said it expects decently sized returns from PENN, noting that its current valuation doesn't take into consideration the full value of its digital business. The analyst maintained its $49 price target. 

PENN received an upgrade from Morgan Stanley late last month, though the shares continued to slide into May, hitting a roughly two-year low of $28.29 on May 12. While the equity is now several sessions removed from this bottom, it will need to overcome recent pressure at the 10-day moving average and $32 level if it wants to start chipping away at its 40.4% year-to-date deficit. 

Analyst sentiment remains split, with eight "buy" or better, and six "hold" ratings on the table, heading into today. Meanwhile, the 12-month consensus price target of $57.47 is an 85.9% premium to last night's close. 

Options traders, on the other hand, have seen a bearish shift. While calls still outnumber puts on an overall basis, the security sports a 50-day put/call volume ratio at the  International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), which sits in the 96th percentile of its 12-month range. In other words, long puts have been much more popular than usual of late. 

Short-term options traders have also been more put-biased than usual. This is per PENN's Schaeffer's put/call open interest ratio (SOIR) of 0.73, which stands higher than 83% of readings from the past year. 

 

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