Las Vegas Sands reports Q3 earnings, sportsbook battle for Pennsylvania and other notable stories in the gambling and iGaming space
Welcome to The Fly's latest edition of "Bet On It", where we look at news and activity in the sports betting and iGaming space.
LATEST IN SECTOR NEWS: Caesars Entertainment (CZR) announced it will once again offer live entertainment with the return of a selection of its shows on the Las Vegas Strip. The company said guests can expect verbal health screenings, non-contact temperature checks, modified seating for social distancing, mandatory masks for guests and staff, limited capacity and more. Las Vegas Sands (LVS) shares rose following its Q3 earnings report on Wednesday. Despite EPS and revenue figures coming in below consensus, the company noted progress in its COVID-19 recovery. "I am pleased to say the recovery process from the Covid-19 pandemic continues to progress in each of our markets," said Sheldon Adelson, chairman and CEO. "Our greatest priority as the recovery continues remains our deep commitment to supporting our team members and to helping those in need in each of our local communities of Macao, Singapore and Las Vegas. We remain optimistic about the eventual complete recovery of travel and tourism spending across our markets, as well as our future growth prospects. We are fortunate that our financial strength supports our previously announced capital expenditure programs in both Macao and Singapore, as well as our pursuit of growth opportunities in new markets."
PENNSYLVANIA SPORTSBOOK BATTLEGROUND STATE:Legal Sports Report noted that Pennsylvania became the latest state to enjoy record sports betting handle in September. Uniquely, Pennsylvania is the only state to report how much operators gave out in promotional credit, or free bets. According to LSR, Barstool Sportsbook (PENN) gave out nearly $2.2M in credits. The sportsbook also lost $656,000 in revenue, before the credits are considered. DraftKings (DKNG) had online revenue of $1.1M and $2.3M given out in promotional credits. FanDuel (PDYPY) took in $6.6M revenue and handed out $4.2M in credit. While many Pennsylvania sportsbooks are using promotions to take advantage of the momentum from the return of the NFL, questions remain on the viability of acquiring customers that way in the long-term. While all sportsbooks are vying for market share in Pennsylvania, Rosenblatt analyst Bernie McTernan estimated Barstool achieved 16% market share in online sports betting handle there during September since launch. He said that Penn National Gaming is on track to meet base case expectations of 15% share. McTernan told investors that Barstool contributed to overall market growth of handle in the state and thinks the early results in Pennsylvania suggest a greater likelihood of his $300 "bull case playing out." McTernan has a Buy rating on Penn National with a $90 price target.
MASSACHUSETTS AND TENNESSEE WAIT THEIR TURN: SportsHandle reported legal Tennessee sports betting is expected to arrive soon. On Thursday, the Tennessee Education Lottery and its Sports Wagering Committee reportedly met for 30 minutes to hash out regulatory wrinkles to govern the four sportsbooks approved and prepared for the shotgun launch on November 1, or even a couple days sooner. BetMGM (MGM), DraftKings, and FanDuel are among the approved operators. On the other hand, LSR reported legalizing sports betting in Massachusetts "appears to be all but dead" in 2020, but next year could see that change. “I’m a strong supporter of it, a lot of the people I’m speaking to are in support of this. I think we’ve got to get moving on it whether it happens this year or next year,” Senator Michael Brady said, according to the report.
SPORTS BETTING ABROAD: DraftKings and Peermont Hotels, Gaming and Resorts, a South African gaming and hospitality group, announced the launch of PalaceBet, a mobile and online sportsbook powered by DraftKings' B2B sports betting technology. Peermont will utilize DraftKings' full sportsbook and platform solution to provide a sports betting experience for South African sports fans, who will have access to a range of product features including Your Bet and Pulse Betting. Data integrations with Betgenius and IMG will ensure that Peermont's customers have access to a wide range of local and international sports including basketball, cricket, football, tennis, and rugby with live betting opportunities as well as Lucky Numbers. The company said the collaboration with DraftKings will enable Peermont to leverage its significant expertise in the land-based casino environment to bring a world class level of service to the online sports betting market and provide a unique betting experience to its players. “It was a no-brainer to partner with DraftKings,” says Iain Gutteridge, PalaceBet’s General Manager. “The way we’re looking to grow and to compete on an international scale, we knew that DraftKings could offer the software solution so that we could not only offer variety, but quality to our clients.”
PUBLICLY TRADED COMPANIES IN THE SPACE INCLUDE: 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), William Hill (WIMHY) and Wynn Resorts (WYNN).