Disney (DIS) stock jumped on Thursday after the company announced an end to its sports betting agreement with Penn Entertainment (PENN). As a result, the ESPN Bet brand will no longer operate starting on Dec. 1. The sports betting collaboration only lasted two years, despite a 10-year, $2 billion agreement.
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ESPN Bet failed to capture a market share in a sector that already had strong competition. The sports betting business is under the control of rivals DraftKings (DKNG) and Flutter Entertainment’s (FLUT) FanDuel, leaving little room for Disney and Penn Entertainment’s venture to operate. That’s despite the power of the ESPN brand.
While Disney has given up on using ESPN to offer sports betting to fans, Penn Entertainment plans to continue its efforts. The company will start offering these services to fans on Dec. 1 under its theScore Bet brand. It will be interesting to see how well this project performs without the ESPN brand and still having to face the difficult competition that is DraftKings and FanDuel.
Disney and Penn Entertainment Stock Movement Today
Disney stock was up slightly in pre-market trading on Thursday, following a small dip yesterday. The shares have only increased 0.43% year-to-date and 12.56% over the past 12 months.
Penn Entertainment stock was up 9.11% this morning, following a 1.05% gain yesterday. The stock has fallen 17.51% year-to-date and 19.14% over the past 12 months.
Disney vs. Penn Entertainment: Which Stock Do Analysts Favor?
Turning to the TipRanks stock comparison tool, traders can see which of these two stocks analysts prefer. Disney shares have the better analysts’ consensus rating at Strong Buy, compared to a Moderate Buy rating for Penn Entertainment. However, PENN’s upside potential of 31.8% is higher than DIS’ 25.78%.
