Welcome to the 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) and the Arizona Cardinals debuted the first sportsbook at a National Football League stadium. The BetMGM Sportsbook at State Farm Stadium is a two-story, 17,000-square-foot entertainment destination featuring sports wagering amenities, concert-hosting facilities, a gourmet grille and bar and a variety of screens to watch games.

Churchill Downs (CHDN) announced a multi-year agreement with Flutter Entertainment's (PDYPY) FanDuel  involving multiple facets of FanDuel's sports wagering, advance deposit wagering and television businesses. Under the agreement, CDI will provide certain technology and services to enable FanDuel's customers to place pari-mutuel wagers on horse racing via FanDuel's sports wagering and ADW platforms. CDI will also authorize wagering on CDI's owned or controlled horse racing content via FanDuel's platforms in the U.S. and grant FanDuel certain television and media rights to broadcast CDI-owned racing content on FanDuel's television networks. In addition, the Agreement provides FanDuel non-exclusive Kentucky Derby sponsorship rights within the sports wagering category. Beginning in January 2023, FanDuel will pay for CDI technology and services provided by United Tote to facilitate pari-mutuel wagering on FanDuel's platforms in the U.S., including FanDuel Sportsbook and TVG. CDI has entered into an agreement to sell 49% of United Tote to New York Racing Association in a transaction that is expected to close by the end of 2022. FanDuel will also receive exclusive television rights to the racing content of all CDI thoroughbred racetracks, including Churchill Downs Racetrack, once its existing non-Derby media rights deal expires in 2023. FanDuel will also receive a non-exclusive sponsorship of the Kentucky Derby in the sports wagering category beginning in 2023 in exchange for an annual sponsorship fee.

Fubo Gaming, a subsidiary of FuboTV (FUBO), announced the launch of Fubo Sportsbook in New Jersey after successfully completing the soft play phase of the state's Division of Gaming Enforcement regulatory process. The launch in New Jersey, via an agreement with Caesars (CZR), "further expands FuboTV's mission to deliver personalized omniscreen experiences that turn passive viewers into active participants," the company stated.

DraftKings (DKNG) announced its newest responsible gaming initiative - the Practice Safe Bets advertising campaign - as the company marks the American Gaming Association's inaugural Responsible Gaming Education Month this September. The campaign includes two commercials - the first featuring professional wrestler The Miz and the second featuring legendary skateboarder Tony Hawk - that emphasize the importance of engaging in responsible gaming, including setting limits on play by using the responsible gaming tools available on the DraftKings app. The spots will air in radio and TV markets across the U.S., as well as on DraftKings' various social media channels.  Separately, the company and Steve Aoki announced that the two-time Grammy-nominated DJ and producer has agreed to become an official brand ambassador of DraftKings Marketplace. Aoki will support DraftKings' Web3 efforts, with an emphasis on the Reignmakers franchise, an NFT-based fantasy sports series where players will be able to build a collection of NFT player cards with which they can draft a lineup for use in fantasy sports-style games.

It was disclosed that Cathie Wood's ARK Investment bought 57,000 shares of DraftKings Thursday. This comes in addition to the 153,000 shares of DraftKings the firm bought on Tuesday.

Part of Caesars (CZR), Harrah's New Orleans and Horseshoe Bossier City Hotel & Casino each opened Caesars Sportsbook locations at their resorts. In addition, Harrah's debuted the largest poker room in Louisiana with its grand opening of the new World Series of Poker Room.

Churchill Downs, or CDI, announced that the company has completed its previously-announced purchase of Chasers Poker Room in Salem, New Hampshire. The purchase of Chasers follows the approval of the transaction by the New Hampshire Lottery Commission. CDI plans to construct an expanded charitable gaming facility in Salem, with up to 800 gaming positions including historical racing machines and table games. CDI expects the total investment in Salem, inclusive of the purchase price, to be approximately $150M.

Invitation Homes (INVH) is to replace Penn Entertainment (PENN) in the S&P 500 at open on September 19. Consequently,  Penn will replace Mercury General (MCY) in S&P 400 at open on the same date. 

NFL IS KING:  A record 46.6M American adults, 18%, plan to bet on the upcoming National Football League, or NFL, season, up 3% year-over-year, according to new American Gaming Association, or AGA, research.  “The sustained interest in NFL wagering reflects the growth and continued maturation of legal sports betting across the country,” said AGA President and CEO Bill Miller. “Consumers clearly want legal sports betting options and understand the regulated industry’s foundational commitments to responsibility.” As legalization spreads, bettors are reportedly moving away from bookies and toward regulated options. Of American adults:

• 23M will place a bet online this season, up 18% from 2021.
• 6M will place a bet in-person at a sportsbook this season, up 2% from 2021.
• 13% of NFL bettors say they will use a bookie, down 2% and 5% from 2020.
• Bookie usage is 50% higher in states without legalized sports betting.

More than 132M of American adults can legally wager in their home state, 18M more than this time last year. Among NFL bettors, the Buffalo Bills and Tampa Bay Buccaneers are the most popular picks to win Super Bowl LVII, followed by the Los Angeles Rams and Kansas City Chiefs and the Dallas Cowboys. The Super Bowl will be played in Arizona, a legal sports betting jurisdiction for the first time in February 2023.

MARYLAND MISHAP: The NFL season begins Thursday without Maryland’s mobile sports betting industry close to launch, Erin Cox of The Washington Post reported. This leaves the state to miss out on the historically lucrative part of the sports gambling calendar. Governor Larry Hogan has previously pointed out that Maryland’s neighbors moved more quickly  to get sports betting up and running on smartphones., but some state policymakers are reportedly congratulating themselves. Cox noted that their methodical approach attempted to spread the wealth to smaller minority- and women-owned companies.

SLOW AND STEADY: Regulators on the Massachusetts Gaming Commission spoke to bettors conveying the message that legally wagering on sports will take time and patience, Colin A. Young of NBC Boston reported. The legal sports betting bill  was passed on August 1 and is now in the process of being written up by the commission regarding the rules and the regulatory framework for a new form of legal gambling in Massachusetts. The commission is in early stages of the process of getting legal betting off the ground. "Our goal with this process is to make sure that such sports wagering is introduced correctly, operationally and legally, for the benefit of integrity and consumer protection. We accomplish this goal by working diligently to develop policy, establish a regulatory structure that equitably, fairly reviews ... potential operators," chairwoman Cathy Judd-Stein said at a commission meeting on sports betting implementation. "We know that the NFL kicks off tonight. And that, due to the nature of sports wagering, interest is piqued. We are rooting for the Pats. Our process will play out as it would have whenever this law came to the Gaming Commission to regulate and we will not compromise getting this right for anything. With that said, we also are aware of the import of timing." Each commissioner echoed the chairwoman's remarks and Commissioner Brad Hill mentioned a segment he heard on 98.5 The Sports Hub's "Toucher and Rich" morning show while stuck in traffic Thursday morning. "Today I actually got a little frustrated with it because they had a guest on and they were talking about sports betting and they made a comment that some think that we might be able to make a bet in three weeks at our brick and mortar casinos and our simulcasting facilities. And, obviously, that is not going to happen," Hill said. "And it was frustrating because of the hundreds of thousands of people that listen to that show and think that they might be able to place a bet here in Massachusetts, it was frustrating." State Treasurer Deborah Goldberg testified before the Gaming Commission on Thursday, asking them to mandate that sports betting operators commit to cross-promote the Massachusetts Lottery and present a plan to mitigate negative impacts the lottery might see as a result of the gambling expansion. "As you draft sports wagering regulations, I urge you to incorporate provisions that will ensure that the Lottery continues to sustain itself and grow its revenue, providing valuable resources for every community in the Commonwealth," Goldberg said. "While lawmakers project that sports wagering will generate $60 million in state revenue each year, only $16.5 million will be earmarked for unrestricted local aid. By contrast, the Lottery produced approximately $1.1 billion for our cities and towns just last year. Simply put, the Lottery plays a vital role in generating unrestricted local aid for our cities and towns, and it is imperative that we work to ensure it continues to do so."

ANALYST COMMENTARY: Argus analyst John Staszak downgraded MGM Resorts to Hold from Buy. The analyst warned that the high costs and competition will offset growth in the U.S gaming industry along with the management's ability to implement its growth initiatives. Staszak further noted that China's stringent COVID-19 regulations and strict supervision of VIP gaming could harm results in the near term, though longer-term he is positive on the increase in casino spending in Las Vegas, growing demand for sports betting in the U.S., and a build-out of the infrastructure in Macau.

On the other hand, JPMorgan analyst Joseph Greff believes shares of MGM Resorts, which are down 27% year-to-date, "represent good value." Current levels underestimate the company's domestic land-based casino free cash flow potential, Greff told investors in a research note. The analyst estimates that at $32, MGM's share price is implying an almost 20% free cash flow yield to the equity, adjusting for its high excess cash balance at the end of next year, its stakes in Macau and BetMGM, and its soon-to-close LeoVegas. He maintained an Overweight rating on the name with a $47 price target.

Susquehanna analyst Joseph Stauff raised the firm's price target on DraftKings to $24 from $20 and keeps a Positive rating on the shares. The analyst noted they achieved incremental cost savings of $40m in 1Q and $60m in 2Q yet still grew users +30% in 1H 2022 and he thinks this is notable considering management's "shift" to profitable growth from investment in TAM expansion last year.

PUBLICLY TRADED COMPANIES IN THE SPACE INCLUDE: Accel Entertainment (ACEL), Bally's (BALY), Boyd Gaming (BYD), Caesars (CZR), Churchill Downs (CHDN), DraftKings (DKNG), Flutter Entertainment (PDYPY), Gan Limited (GAN), Genius Sports (GENI), Las Vegas Sands (LVS), MGM Resorts (MGM), Penn Entertainment (PENN), Rush Street Interactive (RSI) and Wynn Resorts (WYNN).