Penn National Gaming (PENN) - Get Reportshares on Thursday rose after Goldman Sachs analyst Stephen Grambling initiated coverage of the casino company with a buy rating and $60 share-price target.

Hes enthusiastic about the Wyomissing, Pa., company's sports-gambling potential.

The stock recently traded at $51.69, up 3.9%. The stock has traded up as much as 7.7% on Thursday, and it has more than doubled year to date.

PENN sits at the cross-section of a rapidly rebounding regional casino space and inflecting growth in sports betting, Grambling wrote in a commentary obtained by TheStreet.com.

Penn National "has unique positioning relative to peers based on mobility and covid-19 data analysis, he said. This guides our near-term segment earnings before interest, taxes, depreciation and amortization above consensus expectations.

In addition, we believe Barstool Sports embedded customer base and content creationengine will drive one of the lowest customer acquisition costs in the sports betting industry, allowing PENN to quickly take share within our proprietary iGaming and sports betting models, Grambling says.

As the company delivers on existing and mobile growth opportunities, we see upsideto consensus estimates driving a multiple rerating from about 8.3 times next-12-months enterprise value/[Ebitda and restructuring and rent costs] today to our target of 10.5 times EV/Ebitdar.

Penn National last week reported that second-quarter revenue plunged to $305.5 million from $1.32 billion in the year-earlier quarter.

The coronavirus pandemic hammered the company and the industry, shutting casinos and keeping gamblers at home.

Despite starting the second quarter with our entire property portfolio closed due to the pandemic, we ended the quarter in a significantly improved financial position," Penn National Chief Executive Jay Snowden said in a statement.

That came "as a result of continued mitigation efforts that contributed to significant margin improvement, a successful capital raise, and very strong financial performance at our properties since reopening.

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Penn National Initiated Buy on Sports-Gambling Potential - TheStreet