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Online Betting Prospects Bright: 3 Gaming Stock in Focus
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The prospects of the U.S. sports betting have changed drastically over the past three years. Thanks to the Supreme Court ruling in 2018, which overturned the Professional and Amateur Sports Protection Act (PASPA) that banned sports betting outside Nevada. Legalization of sports betting outside Nevada has given the industry a new lease of life.
Sports betting has been legalized in Nevada, Delaware, New Jersey, Mississippi, West Virginia, New Mexico, Pennsylvania, Rhode Island, Arkansas, New York, Iowa, Oregon, Indiana, New Hampshire, Illinois, Michigan, Montana, Colorado, Washington, D.C., Tennessee, Virginia and North Carolina. Moreover, other states are likely to follow the trend is the coming months.
iGaming Market Gains on Pandemic
The coronavirus pandemic has rattled most of the industries and Gaming has been no exception. Casino visitations in 2020 declined sharply due to lockdowns and other coronavirus-related restrictions. This provided an opportunity for casino operators to focus on online betting. Although majority of the casinos have reopened with safety protocols, gaming revenues are below the pre-pandemic level. In such a scenario, companies are focusing more on iGaming business operations to generate online gambling revenues.
Per ResearchAndMarkets, the global online gambling market is likely to reach $97.69 billion, witnessing a CAGR (2020-2025) of 11.31%. Growth in the gambling market is likely to be driven by increase in smartphone adoption and improving internet infrastructure globally.
Per Nielsen report, in first-quarter 2021, the online gambling industry, primarily sports betting, spent $154 million on local TV advertisements, up $10.7 million from the start of 2019. The spending is likely to increase as more states allow online betting in the months ahead. Some of the popular igaming applications include DraftKings, Barstool, FanDuel, BetMGM, BetRivers, Fox Bet and BetMonarch. Markedly, the applications have been an important medium for gamers to connect, learn and inspire amid the stay-at-home restrictions.
Development in latest online gaming technology to drive revenues has led many companies to invest heavily in digital initiatives to improve reliability and customer services. According to the American Gaming Association, sports betting in the United States generated revenues of $1.5 billion in 2020, up 69% year over year. In first-quarter 2021, sports betting revenues improved 270% year over year.
We have highlighted three Gaming stocks that have a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold), and are likely to witness robust growth backed by online betting. You can see the complete list of today’s Zacks #1 Rank stocks here.
3 Gaming Stock to Focus On
Boyd Gaming Corporation (BYD - Free Report) : Boyd Gaming has been undertaking efforts to expand online betting offerings. During second-quarter 2020, the company expanded its partnership with FanDuel Group, which includes retail sports books at seven Boyd properties, mobile sports betting apps in Pennsylvania and Indiana as well as the online gaming site in Pennsylvania. During third-quarter 2020, the company continued to expand its partnership with FanDuel Group, thereby launching mobile sports betting products in Illinois and Iowa. Going forward, the company is optimistic about online gaming prospects in Ohio, Louisiana, Missouri and Kansas. Apart from FanDuel, the company continues to focus on Stardust brand to expand its online gaming presence. During second-quarter 2021, it rolled out of Stardust online casinos in Pennsylvania and New Jersey.
In the past year, shares of the company have gained 201.9%, compared with the industry’s rally of 65.9%. The Zacks Rank #1 company is estimated to report earnings of $3.24 in 2021, against a loss of 15 cents in the prior-year quarter. The company also has an impressive long-term earnings growth rate of 19.8%.
MGM Resorts International (MGM - Free Report) : Sports betting and iGaming continues to be a major growth driver following the legalization of sports betting outside Nevada. Thereby, the company continues to focus on sports betting expansion. Earlier, BetMGM and GVC Holdings — announced second round of investment. This brings the total investment to $450 million. During first-quarter 2021, BetMGM reported solid results on the back of market share gains in existing markets, and new entries such as Iowa, Michigan and Virginia. As of February 2021, BetMGM’s market share stood at 22% in its active markets. It also reported strengthening of position in New Jersey with market share gains of more than 30%. Meanwhile, BetMGM operations contributed $163 million to net revenues during the first quarter. Markedly, the operation results are encouraging compared with the total net revenues of $178 million in 2020.
In the past year, shares of the company have gained 149.8%. The Zacks Rank #3 company is expected to report year-over-year earnings growth of 15.4% in 2021.
Penn National Gaming, Inc. (PENN - Free Report) : The company is focusing sports betting expansion to drive growth. On Jan 22, 2021, it unveiled Barstool Sports online sports betting app in Michigan. Notably, the company witnessed solid demand and acquired a significant number of new customers on the back of Barstool media partnership tools. The company’s Barstool Sportsbooks and iCasino offerings in Michigan and Pennsylvania continues to drive its performance. On Mar 11, 2021, Penn National launched the Barstool Sportsbook app in Illinois, where the company performed better than expected in the first 30 days of launch. During the period, 54,700 new customers were registered. Despite the coronavirus pandemic, the company announced that it will continue to invest in projects, which will generate EBITDA in the short term.
In the past year, shares of the company have gained 155.3%. The Zacks Rank #3 company is anticipated to report year-over-year earnings growth of 148% in 2021.
Infrastructure Stock Boom to Sweep America
A massive push to rebuild the crumbling U.S. infrastructure will soon be underway. It’s bipartisan, urgent, and inevitable. Trillions will be spent. Fortunes will be made.
The only question is “Will you get into the right stocks early when their growth potential is greatest?”
Zacks has released a Special Report to help you do just that, and today it’s free. Discover 7 special companies that look to gain the most from construction and repair to roads, bridges, and buildings, plus cargo hauling and energy transformation on an almost unimaginable scale.
Image: Bigstock
Online Betting Prospects Bright: 3 Gaming Stock in Focus
The prospects of the U.S. sports betting have changed drastically over the past three years. Thanks to the Supreme Court ruling in 2018, which overturned the Professional and Amateur Sports Protection Act (PASPA) that banned sports betting outside Nevada. Legalization of sports betting outside Nevada has given the industry a new lease of life.
Sports betting has been legalized in Nevada, Delaware, New Jersey, Mississippi, West Virginia, New Mexico, Pennsylvania, Rhode Island, Arkansas, New York, Iowa, Oregon, Indiana, New Hampshire, Illinois, Michigan, Montana, Colorado, Washington, D.C., Tennessee, Virginia and North Carolina. Moreover, other states are likely to follow the trend is the coming months.
iGaming Market Gains on Pandemic
The coronavirus pandemic has rattled most of the industries and Gaming has been no exception. Casino visitations in 2020 declined sharply due to lockdowns and other coronavirus-related restrictions. This provided an opportunity for casino operators to focus on online betting. Although majority of the casinos have reopened with safety protocols, gaming revenues are below the pre-pandemic level. In such a scenario, companies are focusing more on iGaming business operations to generate online gambling revenues.
Per ResearchAndMarkets, the global online gambling market is likely to reach $97.69 billion, witnessing a CAGR (2020-2025) of 11.31%. Growth in the gambling market is likely to be driven by increase in smartphone adoption and improving internet infrastructure globally.
Per Nielsen report, in first-quarter 2021, the online gambling industry, primarily sports betting, spent $154 million on local TV advertisements, up $10.7 million from the start of 2019. The spending is likely to increase as more states allow online betting in the months ahead. Some of the popular igaming applications include DraftKings, Barstool, FanDuel, BetMGM, BetRivers, Fox Bet and BetMonarch. Markedly, the applications have been an important medium for gamers to connect, learn and inspire amid the stay-at-home restrictions.
Development in latest online gaming technology to drive revenues has led many companies to invest heavily in digital initiatives to improve reliability and customer services. According to the American Gaming Association, sports betting in the United States generated revenues of $1.5 billion in 2020, up 69% year over year. In first-quarter 2021, sports betting revenues improved 270% year over year.
We have highlighted three Gaming stocks that have a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold), and are likely to witness robust growth backed by online betting. You can see the complete list of today’s Zacks #1 Rank stocks here.
3 Gaming Stock to Focus On
Boyd Gaming Corporation (BYD - Free Report) : Boyd Gaming has been undertaking efforts to expand online betting offerings. During second-quarter 2020, the company expanded its partnership with FanDuel Group, which includes retail sports books at seven Boyd properties, mobile sports betting apps in Pennsylvania and Indiana as well as the online gaming site in Pennsylvania. During third-quarter 2020, the company continued to expand its partnership with FanDuel Group, thereby launching mobile sports betting products in Illinois and Iowa. Going forward, the company is optimistic about online gaming prospects in Ohio, Louisiana, Missouri and Kansas. Apart from FanDuel, the company continues to focus on Stardust brand to expand its online gaming presence. During second-quarter 2021, it rolled out of Stardust online casinos in Pennsylvania and New Jersey.
In the past year, shares of the company have gained 201.9%, compared with the industry’s rally of 65.9%. The Zacks Rank #1 company is estimated to report earnings of $3.24 in 2021, against a loss of 15 cents in the prior-year quarter. The company also has an impressive long-term earnings growth rate of 19.8%.
MGM Resorts International (MGM - Free Report) : Sports betting and iGaming continues to be a major growth driver following the legalization of sports betting outside Nevada. Thereby, the company continues to focus on sports betting expansion. Earlier, BetMGM and GVC Holdings — announced second round of investment. This brings the total investment to $450 million. During first-quarter 2021, BetMGM reported solid results on the back of market share gains in existing markets, and new entries such as Iowa, Michigan and Virginia. As of February 2021, BetMGM’s market share stood at 22% in its active markets. It also reported strengthening of position in New Jersey with market share gains of more than 30%. Meanwhile, BetMGM operations contributed $163 million to net revenues during the first quarter. Markedly, the operation results are encouraging compared with the total net revenues of $178 million in 2020.
In the past year, shares of the company have gained 149.8%. The Zacks Rank #3 company is expected to report year-over-year earnings growth of 15.4% in 2021.
Penn National Gaming, Inc. (PENN - Free Report) : The company is focusing sports betting expansion to drive growth. On Jan 22, 2021, it unveiled Barstool Sports online sports betting app in Michigan. Notably, the company witnessed solid demand and acquired a significant number of new customers on the back of Barstool media partnership tools. The company’s Barstool Sportsbooks and iCasino offerings in Michigan and Pennsylvania continues to drive its performance. On Mar 11, 2021, Penn National launched the Barstool Sportsbook app in Illinois, where the company performed better than expected in the first 30 days of launch. During the period, 54,700 new customers were registered. Despite the coronavirus pandemic, the company announced that it will continue to invest in projects, which will generate EBITDA in the short term.
In the past year, shares of the company have gained 155.3%. The Zacks Rank #3 company is anticipated to report year-over-year earnings growth of 148% in 2021.
Infrastructure Stock Boom to Sweep America
A massive push to rebuild the crumbling U.S. infrastructure will soon be underway. It’s bipartisan, urgent, and inevitable. Trillions will be spent. Fortunes will be made.
The only question is “Will you get into the right stocks early when their growth potential is greatest?”
Zacks has released a Special Report to help you do just that, and today it’s free. Discover 7 special companies that look to gain the most from construction and repair to roads, bridges, and buildings, plus cargo hauling and energy transformation on an almost unimaginable scale.
Download FREE: How to Profit from Trillions on Spending for Infrastructure >>