Welcome to latest edition of "Bet On It," where The Fly looks at news and activity in the sports betting and iGaming space.
SECTOR NEWS: BetMGM (MGM) launched its sports betting app in Pennsylvania, giving customers access to benefits tied to MGM Resorts' casino-resorts nationwide. The BetMGM app offers a sports betting experience, making it easy to customize pre-game, live in-play, futures and parlay wagers, the company stated in a press release announcing the launch.
A sports betting bill in Ohio did not reach the Senate floor in the final days of the legislative session, Matthew Kredell of Play Ohio reported. Senator John Eklund indicated that the bill's failure had nothing to do with the content of the bill but rather a federal corruption case that hit the Ohio statehouse, Kredell added. “I think it has to do with the aesthetics and pressure of other business and what people see as their priorities at this point,” Eklund said. “I think the time we lost to the COVID reaction was the first issue. Then the distraction caused by investigations into elected officials in Columbus and Cincinnati have given us a little bit too much of a heavy lift.” DraftKings' (DKNG) shares were down on Friday, which was attributed to the Ohio news.
Penn National (PENN) announced that it entered into a definitive agreement with Gaming and Leisure Properties (GLPI) to acquire the operations of Hollywood Casino Perryville in Maryland for $31.1M in cash, subject to certain customary working capital adjustments. Simultaneous with the closing of the transaction, Penn National will enter into a lease with GLPI for the real estate assets associated with the Hollywood Casino Perryville facility with annual rent of approximately $7.77M. The transaction is expected to close in mid-2021, subject to the approval of the Maryland Lottery and Gaming Control Commission and other customary closing conditions.
MONTHLY NEW JERSEY SPORTS BETTING REVENUE: New Jersey's Division of Gaming Enforcement reported that total gaming revenue for November was $288.9M, compared to $306.0 million in November 2019, reflecting a 5.6% decrease. Internet gaming win was $91.8M in November, compared to $49.1M in the prior period, reflecting an increase of 86.9%. Sports wagering gross revenue was $50.6M for the month. Casino win for November was $146.6M, decreasing 34.6% from the same month last year. New Jersey's top five operators by gross gaming revenue were:
- DraftKings Resorts Digital
- Golden Nugget
- MGM Borgata
- FanDuel (PDYPY) Meadowlands
- Caesars' (CZR) multiple resorts
In terms of market share, Loop Capital analyst Daniel Adam noted that the monthly data shows accelerating year-over-year growth for the market, with Buy-rated DraftKings expanding its leading share position in the state. Similarly, BofA analyst Shaun Kelley noted DraftKings and FanDuel moved back in line with their historical average combined share of 77% in NJ after slipping to 67% in October. Kelley told investors that third place in NJ remains more of a toss-up with BetMGM, PointsBet and William Hill all rotating through the position in the last three months. New Jersey, despite declining year-over-year, had the highest sports betting handle out of all states where it is legalized. Action Network's Darren Rovell tweeted the top three states that have reported data were New Jersey with $931.6M, Pennsylvania with $491.4M and Indiana with $250.8M. He also noted Nevada would be number two once they report.
CUOMO SUGGESTS SPORTS BETTING FOR NY REVENUE SHORTFALL: Legal Sports Report noted that during a scheduled briefing to discuss COVID-19, New York Governor Andrew Cuomo suggested sports betting as a way to help New York bring in new revenue as the state faces a budget shortfall. “Are there other ways to get revenue? How about marijuana? How about sports betting?” Cuomo said in the briefing. Brad Allen of LSR, suggested the mention of sports betting in this context could mean that the governor has relaxed his stance on online sports betting in The Empire State. While Cuomo said waiting to do a budget until spring time was his preference, it could still indicate sports betting being included in a budget package in 2021, Allen noted. New York Senator Joseph Addabbo Jr. told LSR that Q1 2021 was the most likely time to get any legislation done. “We’re running out of time for this year so now we look at next year but I can’t see us waiting until the April budget,” Addabbo said. In his note to investors, Kelley said the comments mark a significant change in tone for New York. Kelley said, "We think progress could start as early as January to April, with the primary driver being the state’s $50B budget deficit. We estimate NY could be a $1.3-1.7B addressable market, and the largest potential state to legalize thus far." He concluded that New York could send off a domino effect adding regional pressure for legalization in Massachusetts and Connecticut.
PUBLICLY TRADED COMPANIES IN THE SPACE INCLUDE: Bally's (BALY), Boyd Gaming (BYD), Caesars (CZR), Churchill Downs (CHDN), DraftKings (DKNG), Flutter Entertainment (PDYPY), Gan Limited (GAN), Las Vegas Sands (LVS), MGM Resorts (MGM), Penn National (PENN), Scientific Games (SGMS) William Hill (WIMHY) and Wynn Resorts (WYNN).
