Profit miss and Portnoy allegations taint Penn National shares

Report accused Barstool Sports founder Dave Portnoy of sexual misconduct

Penn National Gaming’s stock plunged 21% in trading Thursday following a lukewarm earnings report and the publication of an article accusing Barstool Sports founder Dave Portnoy of sexual misconduct.

The casino and sportsbook operator, which holds a 36% stake in Barstool, reported net income of $86.1 million in its third quarter earnings report, down from $141.2 million in the same period one year earlier. The company posted earnings of 52 cents per share, well below Wall Street’s forecasts, while quarterly revenue of $1.5 billion was in line with expectations.

Penn National CEO Jay Snowden told analysts the third quarter was a "tale of two halves" for the company. He noted the company’s "momentum slowed" during the quarter due to the surging Delta variant and the impact of Hurricane Ida in southern states.

Barstool Sports founder Dave Portnoy visits Faction Talk at SiriusXM Studios on November 14, 2017 in New York City.  (Slaven Vlasic/Getty Images / Getty Images)

Later in the morning, Business Insider published a lengthy report in which three women alleged they had sexual encounters that "turned into frightening and humiliating experiences." Two of the women, who were identified by pseudonyms, said Portnoy choked or filmed them without advance consent. One woman said she was suicidal after their encounter.

Portnoy denied wrongdoing in a series of videos posted to his Twitter account. In the videos, the Barstool Sports founder described the Business Insider report as a "hit piece," asserting that he had "never" done "anything remotely nonconsensual" during the sexual encounters.

David Portnoy, founder of Barstool Sports, is interviewed at the Trackside Live Stage in the LVMS Neon Garage before the South Point 400 Monster Energy NASCAR Cup Series playoff race on September 15, 2019, at Las Vegas Motor Speedway in Las Vegas, NV (Chris WIlliams/Icon Sportswire via Getty Images / Getty Images)

Penn National did not immediately respond to a request for comment on the allegations.

"We are not in the business of managing our employees’ personal lives, but we have made sure to have specific processes in place that encourage our colleagues to confidentially share any concerns they might have about their work environment," Barstool Sports said in a statement. "This recent news does not involve any workplace behavior. As a matter of policy, we do not comment on the private lives of our employees, but we take this matter seriously and are monitoring it closely."


Barstool Sports founder Dave Portnoy visits SiriusXM Studios on November 14, 2017 in New York City.

Penn National’s stock closed at $57.40 after trading Thursday. The plunge erased more than $2.5 billion from the company’s market cap.