Revenue for Penn National Gaming Inc. (NASDAQ:PENN) in Q3 slowed (see conference call transcript), as it did at most casino operations. But due to the termination of an attempted acquisition deal, the company received a settlement of a cool $225 million. In addition, the (intended) acquisition group purchased 12,500 shares of Series B Redeemable Preferred Stock due 2015 for $1.25 billion.
As a result, Penn reported a net income of $147.5 million. That’s $100.9 million more than the same quarter last year.
Currently, Penn operates 19 facilities in 15 jurisdictions. With this influx of cash, the company has declared itself ready to expand.
Waiting for November 4
Thanks to huge budget deficits, the State of Maryland is reconsidering its former stance on slot machines. This election day, my fellow Marylanders are likely to approve a referendum that would open the state for slots.
Penn has indicated interest in contracts to run slots facilities in Maryland. If the referendum to permit the five proposed sites is passed, the company will be ready to move on the bidding process.
Priced around $20, Penn had seen a 52-week high of $62.25. And with a P/E of 6.5, this company holds promise.