Disney (DIS - Free Report) owned ESPN’s aggressive push into sports betting-related content is continuing unabated. The American sports media giant has entered into separate multiyear sports betting partnerships with Caesars Entertainment (CZR - Free Report) and DraftKings (DKNG - Free Report) .
ESPN will offer content linked to both the gambling companies’ sports booking operations to promote its sports gambling content.
Markedly, in May 2018, the Supreme Court struck down a federal law that effectively made sports betting illegal in most states. There are now 22 states, plus Washington D.C., that have legalized sports betting, according to the American Gaming Association. Another seven have active legislation as of Aug 17.
With states facing significant revenue shortfalls due to the coronavirus pandemic, sports betting may be considered by legislatures across the United States as a way to plug some tax holes. Disney thus sees it as an opportunity to leverage ESPN’s popularity as the dominant sports broadcaster to better connect with gamblers.
The Walt Disney Company Price and Consensus
ESPN’s Content Partnership: A Game Changer
The news of the ESPN partnership fueled a 17.3% single-day rise in DraftKings stock on Sep 14, leading it to close at $48.62 per share, an all-time high while Disney closed 0.5% down at $131.25. DraftKings’ shares has nearly tripled in value since the company went public in April.
The digital sports entertainment and gaming company will become the exclusive daily fantasy sports and co-exclusive sportsbook link-out provider of the ESPN sports TV network and have its brand appear on the broadcaster’s TV shows.
Notably, Disney owns a 6% minority stake in DraftKings, following its acquisition of Twenty-First Century Fox.
Meanwhile, Caesars stock rose 10.5% to $55.39 per share, its highest level since March. The Caesars deal expanded on a deal struck last year that created in part a new ESPN-branded studio at the LINQ Hotel & Casino in Las Vegas, NV.
Moreover, as part of the multi-year deal, Caesars Sportsbook by William Hill becomes a sponsor of ESPN’s fantasy sports products. Caesars is also the exclusive odds provider for ESPN.
Notably, William Hill is also the exclusive sports-wagering provider to the online operations of ViacomCBS (VIAC - Free Report) owned CBS Sports.
Disney’s ESPN Expands Sports Betting Footprint
In addition to having a co-exclusive arrangement with Caesars, Disney is expanding its sports betting footprint in the United States through ESPN with the launch of new digital show Bet and a YouTube channel dedicated to sports betting content.
Bet, which is co-hosted by Joe Fortenbaugh and Tyler Fulghum, will stream three nights per week on digital platforms and will be available for live and on-demand viewing on the ESPN App and on ESPN’s social media feeds on YouTube, Facebook and Twitter.
Additionally, the ESPN Sports Betting YouTube channel will contain segments from Daily Wager, SportsCenter and other programs.
Moreover, ESPN also recently launched the digital show Bettor Days, which is presented by Mike Greenberg on ESPN+.
Similar to ESPN, this Zacks Rank #3 (Hold) company owned Fox Sports launched Fox Bet under a media and sports wagering partnership with The Stars Group in the United States. Fox Bet allows customers in states with regulated betting to wager real money. The company also launched a national free-to-play game last year, awarding cash prizes to players who correctly predict the outcome of the games.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Biggest Tech Breakthrough in a Generation
Be among the early investors in the new type of device that experts say could impact society as much as the discovery of electricity. Current technology will soon be outdated and replaced by these new devices. In the process, it’s expected to create 22 million jobs and generate $12.3 trillion in activity.
A select few stocks could skyrocket the most as rollout accelerates for this new tech. Early investors could see gains similar to buying Microsoft in the 1990s. Zacks’ just-released special report reveals 8 stocks to watch. The report is only available for a limited time.
See 8 breakthrough stocks now>>