Penn Entertainment Stock Surges After Upgrade From JPMorgan, Anticipating Growth

Core Insights - Penn Entertainment shares experienced a surge following an upgrade from JPMorgan, which anticipates growth as the company's investments start to yield returns [1] - JPMorgan raised its rating for Penn from "neutral" to "overweight" and increased the price target from $19 to$27, indicating a potential upside of approximately 30% from the recent price of $20.81 [1] - Despite the recent gains, Penn shares have declined nearly 20% since the beginning of the year [1] Investment Outlook - Analysts expect Penn's investments in retail projects to start generating attractive double-digit cash-on-cash returns beginning in the second half of 2025 and into 2026 [1] - There is a projection of improving free cash flow due to a significant reduction in land-based capital expenditures anticipated in 2026 [1] - The company is expected to utilize its free cash flow to de-lever and reduce its cash interest expenses, alongside a noted decline in interactive gambling losses [1]