: Penn National sheds $2.69 billion in valuation after earnings miss, allegations against Barstool’s Portnoy
Shares of Penn National Gaming Inc. plummeted more than 20% on Thursday after a big third-quarter profit miss and allegations of sexual misconduct against Barstool Sports’ founder.
The decline wiped away $2.69 billion from Penn National’s
PENN,
-21.08%
market cap, the most the gambling company has lost from a stock decline in its 27-year history on the public markets, according to Dow Jones Market Data. While Penn lost about $3.6 billion in market cap on a November day in 2013, that was from spinning off another business.
The 21.1% decline for the stock price was the worst Penn National has absorbed since March 2020, when concerns about the COVID-19 pandemic thrashed the stock market, with casino stocks taking a massive hit. Penn National rebounded soon after on optimism for its tie-up with Barstool Sports, and was added to the S&P 500 index
SPX,
+0.42%
in March of this year.
Penn National’s spiral began when it reported a hefty miss on quarterly profit before the session opened. Penn’s profit fell nearly 40% from a year ago, with its chief executive blaming the effects of Hurricane Ida and the spread of the Delta variant of COVID-19.
Later in the day, allegations emerged against Dave Portnoy, founder of the Barstool Sports sports-media company, detailing occasions where he was aggressive and rough with women. As detailed in a Business Insider story, one woman who had intimate relations with Portnoy said she felt like she was “just a human sex doll.” Another woman said she fought mental health issues like depression after their encounter.
Portnoy responded to the article on Twitter
TWTR,
-1.56%,
where he denied many of the allegations, calling them “jarring,” before adding that “cancel culture has been coming for me for a decade.”
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Penn National shares suffered their lowest close in almost exactly a year, since Nov. 3, 2020. Shares are now down 3.9% in the past 12 months, wiping away a steep rise that happened through the end of 2020 and beginning of 2021.
