Gaming Expansions Will Benefit Penn In 2010
Penn National Gaming (PENN: 25.62 +2.85%) favored 2009 fairly well compared to others in the gaming industry as the majority of the companies casinos are located in the Midwest where flat visitation rates and spending have been reported.
Many states have been looking towards gambling expansions to help supplement budgets and analysts feel that Penn has positioned themselves to benefit substantially in 2010.
In West Virginia, voters approved the expansion of table games in slot parlors. Penn plans to incorporate tables at its Charles Town Races & Slots facility in the first half of 2010. Joseph Greff analyst with J.P. Morgan says the addition could be worth $1.32 a share in incremental equity for Penn.
Ohio, Kansas City and Pennsylvania also have similar bills pending legislative approval.
Penn is in the beginning phases of developing two casinos in Ohio and one in Kansas City. The company already owns and operates one in Pennsylvania.
Missouri and Colorado markets also received a lift from the easing of game restrictions which should benefit Penn in 2010 with two casinos in these states.
However investors seem to fear that Penn will increase its offer on the bankrupt Fontainebleau in order to secure a place in the Las Vegas market and overpay for the rights to the property.
Last month billionaire Carl Icahn outbid Penn’s proposed stalking horse bid, however the bankruptcy auction has not been finalized and bids can still be made.
Join the forum discussion of this news story - (1) PostsRelated posts:
