Since the legalization of sports betting in the US two years ago, gambling stocks have been on the rise. This ruling will be extremely beneficial for traders because an estimate of over $400 billion from black market revenue is about to morph into the mainstream markets.
Despite the recent stock pullback, investors are excited about the beginning of the new football season. The expansion of the sports betting market in the US has already begun in several states, including New Jersey, New York, and Chicago.
Will sports betting stocks be profitable for investors?
Gambling giants from the UK made some exciting deals with US-based companies that will surely pay off in the long run. The reason why these partnerships will become lucrative in the long run is the experience that the UK has with dealing with gambling regulations, which are essential for keeping the business out of trouble.
Due to the current situation, there was a relaxation of the restrictions in the betting market, which allows clients to join online platforms, like the RiversBet app, directly from their mobile devices. This is an excellent opportunity for investors because there will likely be a surge in the stock value of well-established casino operators that will also release a betting app to keep up with the competition.
Before you invest in gambling companies, make sure you test the platforms first. The great thing about online casinos is that most of them offer you no deposit promotions, which means you get free credits or spins upon registration, which will allow you to try out the betting platforms right away.
GVC Holdings (GVC)
GVC Holdings is a PLC listed on the London Stock Exchange is a British gambling giant that owns Ladbrokes Coral, which is one of the most powerful bookmakers in the UK. Adam Greenblatt, the CEO of GVC, announced that he expects a market of avid sports fans, that is 75% larger than the UK to emerge in just a couple years.
After his announcement, GVC reported a growth of over 16% in the second quarter, which is impressive growth compared to previous financial reports. On top of that, the company has confirmed that it will launch its official New Jersey betting app at the start of the NFL season.
We’re looking forward to seeing the evolution of GVC’s partnership with MGM, the leading US casino company with over $4 billion annual revenue just from their Las Vegas establishments.
888 Holdings (888)
888 Holdings is the leader of the online gambling industry, listed on the London Stock Exchange and a constituent of the FTSE250 Index. The giant recently joined the US sports betting market with a new sportsbook in New Jersey.
888 is the first gambling company to sign a deal with an NFL team – the New York Jets. Additionally, by using their advanced research team, they mapped various scenarios of the gambling industry in the US. Even if the legalization of online gambling in the US goes south, and only a few states will agree upon it, the US would be ranked the second place in the world by 2025, right behind the UK.
Boyd Gaming Corporation(BYD)
Founded in 1975 by Sam Boyd, this Las Vegas-based gaming and hospitality corporation is listed on the New York Stock Exchange and has a revenue of over $2.3 billion. As you might know, Boyd Gaming is already a big player in the sports betting market. They strategically positioned in a right spot, and through their recent partnerships and acquisitions, they are more than ready for the surge of the online betting market.
Last year, they signed a deal with MGM to develop their mobile gaming platforms together, and they also have a strategic partnership made with Flutter, a subsidiary of the US-based online gaming provider FanDuel.
In fact, Boyd Gaming’s share had a colossal growth this year – over 26%, and they also released two new sportsbook establishment in Mississippi. Right now, they are planning on opening four more venues in Indiana and Iowa.
MGM Resorts (MGM)
MGM is the second most valuable corporation in the gambling niche, with a market cap of nearly $10 billion. They are renowned for their land-based gambling establishments, like the ones in Vegas and Macau.
At the moment, MGM offers sports betting in Colorado, New Jersey, and Nevada, through the BetMGM feature. On top of that, they had a decisional vote of confidence on August 10th when International Automotive Components (IAC) revealed that it bought 12% of the company for nearly $1 billion.
The fact that IAC bought a large chunk of MGM Resorts is an excellent sign since the company is mainly focused on online businesses. Their spokesperson declared that one of the reasons why they invested in a gambling company is its potential of using existing locations and gaming platforms for sports betting, which is quickly being legalized in many states.
DraftKing was initially released in 2012 as a fantasy sports company and later launched its sports betting service in August 2018. Right now, DraftKing has a market cap of over $13 billion, and it is the most valuable betting company.
One of the main advantages of this company is the fact that their stock is only related to sports betting since the others we’ve mentioned are also in the primary casino business. DraftKings has a considerable advantage over its competition because they have the cleanest balance sheet. The fact that they have zero debt makes it superior to any other company in the gambling market.
The DKNG stock went public on the NYSE through a reverse merger in April. It quickly gained popularity among Wall Street investors since analysts predicted that the betting market in the US would grow from less than $2 billion in revenue all the way to $12 billion by 2025. DraftKing’s share has tripled since its release and has been building up its capital ever since.
The bottom line
Now that you have an excellent overview of the greatest sports betting stocks available, it’s up to you to choose your favorite. We recommend you run an in-depth technical analysis and factor in the relaxation of gambling laws in the US, which will result in some bullish trends in the near future.