FuboTV, Penn National Gaming and Scientific Games are part of Bernstein bull call on gaming

Oct. 19, 2021 12:22 PM ETfuboTV Inc. (FUBO), IGT, CHDN, PENNLNWBy: Clark Schultz, SA News Editor3 Comments

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  • Bernstein is out with a huge bull call on the gaming sector. The firm expects upside for the sector with a forecast for a growing market recovery in retail gaming and improving social outlook surrounding other gaming sector segments like digital and sportsbook.
  • Other positive factors include the growing addressable market in the U.S., the increased odds for legislation in new states with budgets strained and cost improvement amid more M&A and consolidation.
  • Analysts Zachary Silverberg and Brian McNamara say they prefer names with strong growth profiles and conservative balance sheets that appear to be undervalued. With that in mind, Bernstein launches coverage on Penn National Gaming (PENN +4.6%), Churchill Downs (CHDN +0.1%), International Game Technology (IGT +0.4%), Scientific Games (SGMS -0.8%) and fuboTV (FUBO +0.9%) with Buy ratings.
  • On PENN ($95 price target, 22% upside): "We expect will capture mindshare given its strong marketing and reach with Barstool Sports and the vertical integration of theScore’s technology stack."
  • On CHDN ($294 price target, 15% upside): "We believe CHDN warrants a higher multiple given its significant moat in pari-mutuel wagering."
  • On IGT ($35 price target, 20% upside): "We believe IGT will capitalize on the rebound in the gaming sector and strong performance across the globe in the lottery segment."
  • On SGMS ($98 price target, 15% upside): "We believe SGMS offers upside at its current valuation and are optimistic regarding the future of the company as it invests in cross-platform gameplay."
  • On FUBO ($50 price target, 67% upside): "Sports-focused, digitally native TV replacement product, with a strategy of accumulating subscribers from the pool of cord cutters. The company will launch a digital sportsbook product to create sports-focused, interactive environment."
  • Catch up on the latest DraftKings news.

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