Sports Betting Market On The Cusp Of A Boom: Stocks To Watch
Zacks Investment Research | Nov 05, 2019 07:57AM ET
The U.S. sports betting market is set to boom in the near future, with industry heavyweights vying to make the most of it. Panelists at the NYC Sports Betting Investor Summit on Nov 4 said that the U.S. sports betting market will reach a worth of almost $7 billion to $8 billion over the next five years.
The industry is growing by leaps and bounds ever since the U.S. Supreme Court opened up the gigantic sports betting market, helping Americans place $150 billion in illegal wagers on sports every year. Sports gambling won’t be regulated by the Federal Government anymore, instead the individual states will take charge.
Last October, the state of New Jersey handled more than a quarter billion dollars in bets, showing a 41% increase from the previous month. But, that's just half of the $528 million Nevada handled. Legal sports gambling, in fact, state-by-state is growing by the day. Mississippi, Delaware, West Virginia, New Mexico, Pennsylvania and Rhode Island are also leading the way. Governor of Massachusetts Charlie Baker, in the meantime, presented a proposal to legalize gambling on professional sports online and even at casinos in Massachusetts.
Nonetheless, investment giant Morgan Stanley (NYSE:MS) predicts that the U.S. market will be able to generate nearly 7 billion in revenues by 2025, significantly up from $833 million this year. By the way, executives from MGM Resorts, Hard Rock and Mohegan Sun have issued similar projections, with revenues expected to come in between $6 billion and $8 billion within the next five years. To top it, research firm Eilers & Krejcik Gaming, which tracks sports betting regulations, confirmed that their figures are close to what has been predicted by these various organizations.
What’s more, some companies are acquiring others to build high-profile partnership to make the most of the fast-growing industry. For instance, the National Basketball Association recently announced a partnership with authorized sports betting operator DraftKings.
Thus, from casinos to sports clubs to gambling app makers, all are looking to enter the sports betting market to rake in a lot of moolah. Let us, thus, take a look at stocks that can provide outsized returns as U.S. legalizes sports betting —
Scientific Games
Scientific Games Corporation (NASDAQ:SGMS) develops technology-based products and services, and related content for the gaming, lottery, and digital gaming industries. Scientific Games is looking forward to enter sports betting by providing the required infrastructure.
The company has a Zacks Rank #2 (Buy). The company’s expected earnings growth rate for the current quarter is a superb 114.3%. You can see Zacks Investment Research
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