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May 3, 2022, 5:08 a.m. EDT

CGR Issues Report on Best Bets for Sports Gambling Boom (DKNG, WNRS, PDYPF, GAMB, PENN, CZR, MGM)

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May 03, 2022 (AB Digital via COMTEX) -- –Americans have wagered over $100 billion since June 2018

–The total sports betting handle in 2021 was over $57 billion, a 165% increase over 2020.

–The number of people regularly betting on sports increased by 80% in 2021

–The best bets in the industry may surprise you

Gambling on sports is turning into big business, and this trend looks like it will continue. According to a 2021 survey, people aged 44 or under bet far more than older demographics. (31% of people aged between 35 and 44, 28% of people aged 21 to 34, 10% of people aged between 45 and 64, 5% of people 65 or older claim to be regular bettors).

The phrase “the house always wins” is probably why savvy investors are placing their bets on stocks profiting from the sports gambling boom.

FanDuel, a subsidiary of Flutter Ent. (otcmkts:PDYPF) (40%) & DraftKings /zigman2/quotes/213120645/composite DKNG -3.92% (29%) make up over two-thirds of the market share, however, the companies’ shares have plunged in recent months. While top-line revenue has grown at a staggering rate, the marketing costs associated with growing their businesses have caused less than stellar profit margins.

For instance, DraftKings /zigman2/quotes/213120645/composite DKNG -3.92% spent $981.5 million on sales and marketing in 2021, equal to 98% growth year over year and 76% of total revenue. Altogether, DraftKings' operating expenses increased 96% from a year ago, totaling $2.9 billion. The company ended the year with an adjusted loss of $676.1 million in earnings before interest, taxes, depreciation, and amortization (EBITDA), an almost twofold increase in its loss from 2020.

While this could result in significant long-term revenue growth, it is still a risky ‘bet’. If investors have the risk tolerance for sports betting stocks, there are a few OTC companies in the space with business models that could create much higher margins than their more recognizable counterparts.

Winners, Inc. (otcmkts:WNRS) is a stock that could live up to its name for investors. The company’s model is to drive investors to sports gaming sites through affiliate marketing. So they will benefit from the boatload of money companies like DKNG and FanDuel are throwing at customer acquisition.

WNRS stock is particularly interesting because its CEO is one of the most recognizable and respected names in sports handicapping, Wayne Allyn Root; aka “King of Vegas”.

Mr. Root’s resume is impressive:

–At age 16 when the media dubbed him "The Betting Whizkid" and "the next Jimmy the Greek."

–Root has been profiled by the biggest media in the world, including CNBC, CNN, The Wall Street Journal, Fortune, Equities, Worth, Success, Financial Times and Robb Report.

-Starred in a Gambling reality TV show on Spike TV (King of Vegas).

–In 2006, Wayne became the only Vegas oddsmaker or sports handicapper ever awarded a star on the Las Vegas Walk of Stars.

Winners, Inc. (otcmkts:WNRS) is flourishing under his leadership and has hit several impressive milestones in the past few months:

-Partnership with bet365, one of the world's largest sports betting brands and currently legal in New Jersey.

/zigman2/quotes/213120645/composite
US : U.S.: Nasdaq
$ 13.60
-0.56 -3.92%
Volume: 10.36M
June 27, 2022 1:09p
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
$11.89 billion
Rev. per Employee
$411,985
loading...
/zigman2/quotes/213120645/composite
US : U.S.: Nasdaq
$ 13.60
-0.56 -3.92%
Volume: 10.36M
June 27, 2022 1:09p
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
$11.89 billion
Rev. per Employee
$411,985
loading...
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