Michigan Friday was the 15th state – and second largest after New York – to legalize online sports betting, but the news didn’t do much for sports gaming stocks, many of which fell.
As more states legalize internet sports betting, each state’s moves have less of an impact on the market. This was all expected when the Supreme Court legalized gambling in 2018.
DraftKings (DKNG) – Get the report Stocks recently traded at $ 52.70, down 1.61%; Penn National Gaming (PENN) – Get the report, which has a 36% stake in Barstool Sports, traded at $ 106.94, down 0.23%; MGM Resorts International (MGM) – Get the report traded at $ 31.67, down 0.43%; and Wynn Resorts (WYNN) – Get the report was recently traded at $ 106.88, down 2.09%.
Online sports betting is big business. In New Jersey, around 90% of all sports bets are done online, according to MarketWatch.
With regard to Michigan, “the business-friendly tax rate and competitive license fees will also attract operators,” betting analyst Dustin Gouker told MarketWatch. “And with a solid tribal and commercial casino infrastructure in place, Michigan should be ready for quick success.” The state could make $ 40 million a year in profits, he said.
MGM “remains positioned for the attractive long-term growth opportunities in Macau (22% of 2019 EBITDAR), US sports betting and Japan,” Morningstar analyst Dan Wasiolek wrote in a November comment.
“In the US (78% of MGM’s 2019 EBITDA), the 21 casinos are positioned to benefit from an estimated sports betting market of $ 6.2 billion by 2024, and approximately 4% of the company’s total revenue this year generate. ” He puts the fair value at USD 28.