Rovell: Penn Stock Shoots to New High Thanks to Barstool Sportsbook Numbers
Chris Graythen/Getty Images. Pictured: Barstool Sports
Penn stock closed up nearly nine percent on Friday, boosting shares to a new high of $128.91.
Penn missed fourth quarter earning estimates on Thursday, but optimistically lauded gains exhibited by its Barstool acquisition, which it owns 36 percent of and 100 percent of its gambling-related revenue.
The new high puts the value at Penn at north of $20 billion for the first time, $5 billion away from DraftKings.
Penn paid $163 million for their piece in Barstool, 55 percent of it in stock.
That’s paid huge dividends for top Barstool employees and those investors who had faith in the model: Use Barstool’s mass audience to reduce typically high customer acquisition costs.
If someone invested $29,093 on March 18, 2020, when Penn hit a low of $3.75, they would have had $1 million worth of shares at the close today. A $2,900 investment would be worth $100,000 today.
Penn launched Barstool Sportsbook in Pennsylvania last September with the goal of being in the top three in market share and first in profitability. They accomplished that goal in December with an absurd 19.1 percent hold percentage on $71.8 million in revenue.
Last month, in their first 10 days in their second state, Michigan they had 50,000 registrations, 26,000 first time deposits and took $27 million in bets.