Stifel Raises Price Target on Penn Entertainment as Online Casino Strategy Gains Traction

Stifel raised its price target for Penn Entertainment from $23 to $25 per share while reaffirming the operator’s buy rating. The upgrade came after analyst Jeffrey Stantial met with Penn management and left optimistic about the company’s prospects for the second half of 2026. Penn shares closed at $21.21 on June 11, up more than 28 percent over the past year.

The analyst cited healthy performance at land-based casinos, improving returns from completed development projects, and encouraging progress in the digital gaming business. Those factors together support a more positive outlook. From the supplier side this kind of shift in emphasis can reshape how operators allocate resources across channels.

Optimism for Second Half of 2026

Jeffrey Stantial’s meetings with Penn management produced clear reasons for confidence. Land-based assets continue to deliver steady results. Development projects are starting to show better returns.

Digital operations are also moving in the right direction. The combination points to stronger performance ahead. After eighteen years across iGaming and sportsbook operations I have seen how quickly digital momentum can change an entire company’s trajectory.

Penn shares have already climbed more than 28 percent in the past year. The $25 target suggests analysts see further upside if the current trends hold. Management appears focused on execution rather than chasing every market trend.

All Eyes on Online Casino

Penn finished its sports betting partnership with ESPN in December 2025. The company then redirected efforts toward building an online casino-focused business instead of competing directly with leaders in sports wagering. This came after several expensive years trying to establish a meaningful presence in sports betting.

Penn spent approximately $550 million acquiring Barstool Sports before selling it back to founder Dave Portnoy for just $1 in 2023. It then agreed to partner with ESPN in a deal reportedly worth around $2 billion over a decade. ESPN Bet struggled to gain significant market share against FanDuel and DraftKings.

Six months after ending the ESPN arrangement Stifel believes the new strategy is progressing as planned. Sports betting activity declined as Penn reduced promotional spending. Management had anticipated that drop.

The decline has been partially offset by stronger performance from the Hollywood Casino online platform and customer acquisition efforts focused on casino gaming. The move away from heavy sports betting investment looks deliberate. Results are starting to reflect that choice.

Visible Results and Efficiency Gains

Penn reported online casino revenue growth of 362 percent in the first quarter compared with the same period a year earlier. Adjusted EBITDA losses within the digital division were reduced by $70 million at the same time. Those numbers show the transition is producing measurable improvement.

Analysts see further opportunities for profitability through lower marketing expenses, reduced payment processing costs, and operational efficiencies. The focus has clearly shifted toward sustainable growth rather than rapid but costly market share grabs. This approach aligns with how many operators are rethinking digital spend after years of high-promotion battles.

Penn continues to operate theScore Bet across 20 US states and Canada. It has established a strong presence in Ontario. The company is also preparing to expand into Alberta when the province launches regulated online casino and sports betting operations on July 13.

Risks and Counterarguments

Not every element of the strategy is without risk. Sports betting still forms part of the business even if promotional spending has been cut. A sudden surge in competitive intensity or regulatory change in key states could pressure the remaining revenue.

The $2 billion ESPN partnership and earlier Barstool investment show how expensive missteps can become. While the current path shows promise, digital casino growth must remain consistent to justify the pivot fully. Any slowdown in user acquisition or retention on the Hollywood Casino platform would test investor confidence quickly.

Ontario has delivered strong results but expansion into Alberta brings new variables. Launch timing, local competition, and customer behavior will all matter. Past performance in one regulated market does not always translate directly to another.

The Bottom Line is that Penn Entertainment’s deliberate shift toward online casino looks to be paying early dividends according to both financial results and analyst commentary. Jeffrey Stantial’s upgraded target and reaffirmed buy rating reflect confidence that the strategy can deliver sustainable profitability. For industry executives watching digital channel decisions this case offers a practical example of reallocating away from high-cost sports betting battles toward casino-focused growth. Operators evaluating similar moves should track Q2 and Q3 numbers closely to see if the momentum holds. Those preparing market entries or platform adjustments may find value in reviewing tailored advisory approaches at https://sccgmanagement.com/our-services/.