Penn Entertainment stock surges after upgrade from JPMorgan and Anticipating Growth

The Key Takeaways

• Penn Entertainment shares surged Friday after JPMorgan upgraded the casino operator's stock, anticipating growth as its investments begin to pay off.
• The analysts boosted their rating for Penn to "overweight" from "neutral," and lifted their price target to $27 from $19.
• Despite Friday's gains, Penn shares have lost nearly one-fifth of their value since the start of the year.

Penn Entertainment shares (PENN) surged on Friday as JPMorgan raised the stock of casino operator, anticipating future growth.

The firm boosted its rating for Penn to "overweight" from "neutral," and lifted its price target to $27 from $19, implying about 30% upside from Friday's intraday price of $20.81.

The analysts told clients they see Penn's investments in retail projects "beginning to bear fruit and ultimately generating attractive double-digit cash-on-cash returns" beginning in the second half of 2025 and into 2026.

The capital spending on land was expected to improve free cash flow. “dropping dramatically” Penn will be able to use the free cashflow in 2026 to fund its operations. “de-lever and reduce its not so burdensome cash interest expense.” Also, they cited the declining interactive gambling losses of the company.

Shares of Penn rose 4% in early trading Friday, though despite Friday's gains, they've lost nearly one-fifth of their value since the start of the year.

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