Shares of sports betting company DraftKings (NASDAQ:DKNG) have been on fire since their April listing via a reverse merger.
Penn National (NASDAQ:PENN) is a leader in regional casinos, with 41 in 19 states, but sees much of its growth coming from mobile and online sports betting.
Here's a look at how the two stack up.
DraftKings, Penn National Revenue: DraftKings reported first-quarter revenue of $89 million for its namesake brand, for year-over-year growth of 30%. The company was impacted greatly by COVID-19 and told investors it was on pace for 60% growth prior to the pandemic.
Penn National reported revenue of $1.12 billion in the first quarter, a decline from the prior year due to casino shutdowns.
DraftKings, Penn National Users: One of the big reasons Penn National acquired a 36% stake in Barstool Sports for $163 million was Barstool's huge user base.
Barstool has 66 million monthly visitors to its site. Barstool founder Dave Portnoy has 1.6 million followers on Twitter, along with Barstool Sports' 2.4 million. Compare that to DraftKings' 292,000 followers on Twitter.
Portnoy has been dominant at engaging with his followers and has been credited with "the Barstool effect," creating a new legion of day traders.
Penn has 20 million casino customers as part of its loyalty program, giving it a good base to build out its own sports betting app under the Barstool brand, which is expected in August.
DraftKings has a base of 12 million active accounts and saw 720,000 monthly unique players in the first quarter.
DraftKings, Penn National Guidance: DraftKings is targeting 20%-30% market share in online sports betting and 10%-20% market share in iGaming.
The company believes both of these markets will give it an opportunity for annual revenue between $2.9 and $4.7 billion.
DraftKings previously guided for 2020 revenue of $540 million and 2021 revenue of $700 million. Penn National is already at these levels thanks to its physical casinos, bringing in revenue of $5.3 billion in the last fiscal year.
DraftKings shares are up significantly since going public. Shares hit a high of $44.79 earlier this year. The company now has a market capitalization of $13.3 billion.
Penn National shares have been on a roller coaster this year. The stock is now up 41% in 2020, but traded as low as $3.75 due to casinos shutting down.
Benzinga's Take: Penn National has a market capitalization of $4.9 billion. Investors appear to be favoring the high growth aspirations of DraftKings and ignoring the existing revenue and growth opportunity at Penn National.