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How Barstool's controversies pulled legs out from Penn's stock

Aug 9, 2023
🎰 PENN Entertainment stock price
Data: Yahoo Finance; Chart: Axios Visuals

Penn Entertainment stock is down 14% since it first announced it was buying a stake in Barstool Sports in January 2020 as the deal failed to reap long-term benefits for the gambling company.

Why it matters: The company signed a sports betting deal with ESPN and sold Barstool back to its founder Dave Portnoy, who attributed the decision to the negative effect he and the media brand had on Penn's stock price.

What they're saying: In a video announcement Tuesday, Portnoy cited separate reports by Insider and The New York Times — both about problematic behavior — as "f---ing" with the stock price.

  • Portnoy also noted issues with gambling regulators, which The Wall Street Journal reported in March 2022.
  • "Every time we did something, it was one step forward, two steps back. We got denied licenses because of me. You name it. So the regulated industry [is] probably not the best place for Barstool Sports and the type of content we make," Portnoy said.

The intrigue: Portnoy did not mention the recent firing of Ben Mintz — a Barstool personality who was let go after saying a slur while reading song lyrics on a livestream — as a reason for the parting of ways. But Portnoy's remarks after the incident, in which he shared his disagreement with Penn's decision, echoed Tuesday's sentiment.

  • "The board is doing what they have to do to protect Penn Entertainment," Portnoy said in May. "It's their world, the regulator, dealing with the state. ... If it was me and the state wanted to pull the license because of this, I'd put it on blast 100-fold."
  • "It is what it is, and hopefully I never have to make a press conference like this ever again," he added.
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