PENN Entertainment Inc (PENN.O): First Look - 2Q26 Margin Beat; Retail Guidance Again Raised

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06 Aug 2026 08:16:10 ET │ 9 pages

PENN Entertainment Inc (PENN.O)

First Look - 2Q26 Margin Beat; Retail Guidance Again Raised

CITI'S TAKE

Thursday before the open, PENN Entertainment (PENN) reported 2Q26

Adjusted EBITDA of $313M, above our estimate of $304M and the Street's

(VA) $296M. 2Q26 net revenues of $1.86B were +5% y/y, in line with

our/the Street’s numbers, whereas Consolidated Adjusted EBITDA margin

of 16.8% was +343 bps y/y, above our estimate of 16.3% (+295 bps y/y).

The top line saw offsetting performance from the Midwest segment

(which beat) and the interactive segment (which missed on the top line

but beat on EBITDA), while margin outperformance was most pronounced

in the South Segment.

Neutral / High Risk

Price (05 Aug 26 16:00)

US$19.62

Target price

US$22.00

Expected share price return

12.1%

Expected dividend yield

0.0%

Expected total return

12.1%

Market Cap

US$2,624M

By segment:

US Gaming

• Northeast Segment revenues were $732M (+3% y/y) vs. Citi $733M (+3%

y/y) and the Street's $723M (+2% y/y). Northeast Segment EBITDAR was

$220M (margin of 30.1% was +66 bps y/y) vs. our $233M (+11% y/y) and

the Street's $214M (+2% y/y).

• South Segment revenues were $302M (flat y/y) vs. Citi $305M (+1% y/y)

and the Street's $301M (-1% y/y). South Segment EBITDAR was $109M

(margin of 36.1% was +144 bps y/y) vs. our $100M (-5% y/y) and the

Street's $104M (-1% y/y).

James HardimanAC

Sean Wagner

• West Segment revenues were $152M (+10% y/y) vs. Citi $145M (+5% y/y)

and the Street's $147M (+7% y/y). West Segment EBITDAR was $55M

(margin of 36.3% was -249 bps y/y) vs. our $52M (-3% y/y) and the Street's

$58M (+8% y/y).

• Midwest Segment revenues were $321M (+8% y/y) vs. Citi $309M (+4%

y/y) and the Street's $314M (+6% y/y). Midwest Segment EBITDAR was

$133M (margin of 41.5% was +50 bps y/y) vs. our $125M (+3% y/y) and the

Street's $123M (+1% y/y).

• Interactive Segment revenues were $349M (+11% y/y) vs. Citi $370M

(+17% y/y) and the Street's $380M (+20% y/y). Interactive Segment EBITDA

was ($10M) (margin of -2.7% was +1,541 bps y/y) vs. our ($16M) and the

Street's ($12M).

• For the second time in two quarters, management is raising Retail Segment

…