Gambling Company Stocks Tanking, Calls for Ban on Team Sponsorship Deals
Penn National and Draftkings stock prices Thursday saw drops of roughly 10% and 8%, respectively.
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Penn National's stock fell 15 percent in April.
There had been little negative news associated with the company over that time frame. They even received an upgrade from Wall Street. So what gives?
Between April 2020 and March 2021, Penn National's stock was up a massive 960%. This is likely just a correction.
The Motley Fool writes:
Long-term investors should probably tread with caution here. It's not that Penn National Gaming is a bad company; it's just that after such a massive price move, it really isn't a shock to see investors wanting to take some profits. So unless there's a catalyst to bring new investors in, this gaming stock could continue to face headwinds given that a lot of good news has been priced into the shares over the past year or so.
Penn National's top sports betting brand is Barstool Sports. Just past Noon Eastern Time Thursday, the company was down to $82.68, its lowest since Jan. 4.
The Action Network noted the following concerns:
Investors looking at Penn focus on “free” customer acquisition through the Barstool brand, while those focusing on DraftKings scrutinize how much the company spends to get its customers.
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Forest Green Rovers have become the first professional club in England to call for a gambling sponsorship ban -
The Forest Green Rovers become the first soccer club to call for an outright ban on gambling sponsorships.
The English Football League has opposed a ban, with chairman Rick Parry telling BBC Sport it would cost EFL clubs £40m a season and could see some go under.
"I believe gambling in football is an abuse of football and of fans," said Forest Green Rovers owner Dale Vince.
"Gambling has overtaken football. If you watch a game on TV you are inundated with adverts. For me, the fun has already stopped," he added.
Eight of 20 Premier League teams have gambling sponsorships on their shirts, and 10 of 24 in the Championship.
- Aaron Goldstein, Gambling911.com
