DraftKings, Penn National Gaming are viewed cautiously in first ratings look by CBRE; VICI and Gaming and Leisure are Buys

CBRE Equity Research starts off sweeping coverage in the U.S. casino, sports betting and iGaming sector with Hold ratings on DraftKings (DKNG +3.0%) and Penn National Gaming (PENN +2.4%).
Analyst John DeCree is cautious on the technical outlook for DKNG even after the recent share price drop. He notes that DKNG continues to execute well on a fundamental but faces a wave of new competition with deep pockets. DeCree still looks the long-term potential for DKNG.
In regard to Penn (NASDAQ:PENN), DeCree and team derive a $60 per share valuation based on a sum-of-the-parts evaluation. Negative headlines around Barstool founder Dave Portnoy are noted to have held back institutional capital at least for the very short term.
Both DKNG and PENN are being watched closely for inflection points to take the rating to Buys.
Meanwhile, the favorable backdrop for the U.S. gaming industry has DeCree and team more enthusiastic on casino real estate and gaming REIT stocks. DeCree continues to recommend shares of both Buy-rated VICI Properties (VICI +2.6%) and Gaming and Leisure Properties (GLPI +1.0%), with a preference for VICI due to its "unique company-specific catalysts ahead" including a substantial increase in scale and a prospective credit ratings upgrade.
Read about some of the other new Buy-rated stocks at CBRE from the sports betting/iGaming sector.