The Resorts & Casinos Industry's Penn National Gaming (PENN) was InvestorGuide.com's Stock of the Day on 7/3/2008.
Will Penn National Rebound after Being Jilted by Private Equity?
2007 - Especially the first half of it, was the year of buyouts, especially leveraged ones, as private equity firms used the cheap credit which flooded the markets to take aim at public businesses, lever them up, and then either restructure the poorly performing ones or ride the coattails of the free cash flow being generated by the top-performing ones. However, 2008, no matter how you look at it, is the year of the 'failed buyouts'. A lot of the transactions that were announced last year are now in the trash can. Add the Penn National Gaming buyout to the list. This morning, it was officially announced that the company, the buyers and the banks have agreed to call it quits. Typically, in these cases, shares in the target company fall when the deal is called off because shareholders are bummed out that they will not be getting the hefty premium that comes with these buyouts. However, today, Penn National ended the holiday-shortened training session up almost 4%. Why the enthusiasm? And there is further room on the upside for the stock?Read more

Click here to see the complete Stock of the Day archives!

Subscribe to the Stock of the Day!