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: Casino stocks have been sinking as of late as inflation has soared and fears of a recession rattle both consumers and investors, CNBC's Contessa Brewer reported. So far this quarter, Caesars (CZR) has dropped 50%, Bally's (BALY) has fallen 40%, and Penn National (PENN) and MGM Resorts (MGM) have each declined 35%. Despite this, the American Gaming Association reportedly said that the industry posted $4.99B in revenue in April, up 12.4%. Jefferies gaming analyst David Katz told investors in a research note that meetings with management teams in Las Vegas provided evidence of the dichotomy between the current operating strength and the markets’ expectation of a recession.
BetMGM announced a new partnership with Carnival Corporation (CCL) to deliver retail and mobile sports betting and iGaming experiences to cruise ship guests. Through this partnership, gaming will be available on more than 50 ships ported in the U.S. spanning Carnival Cruise Line, Holland America Line and Princess Cruises. BetMGM's platform will roll out in phases over the coming months. Under the agreement, Carnival Corporation will offer BetMGM-branded digital and cash-based sports betting, as well as digital real-money gaming products on-board Carnival's U.S.-branded ships in international waters. Additionally, BetMGM and Carnival Corporation will collaborate on co-marketing and promotional activations. BetMGM is a partnership between MGM Resorts International (MGM) and Entain Plc (GMVHF).
Based upon filings with the New Jersey Division of Gaming Enforcement, total gaming revenue reported by casinos, racetracks, and their partners was $430.6M for May, reflecting a 15.1% increase from $374.2M reported in May 2021. For year-to-date, total gaming revenue reported by casinos, racetracks, and their partners was $2.03B reflecting a 18.1% increase from $1.72B reported in the prior period. Based upon filings with the Division of Gaming Enforcement, Total casino win for the nine casino hotel properties was $233M for May, reflecting growth of 9.3% compared to $213.1M for May 2021. Year-to-date total casino win for the nine casino hotel properties was $1.08B, reflecting growth of 20.7% compared to $895.9M for the prior period. For the month of May, internet gaming win reported by casinos and their partners was $136M, reflecting growth of 25.7% compared to $108.2M for the prior period. For the year-to-date period, internet gaming win reported by casinos and their partners was $681.4M, reflecting growth of 29.3% compared to $527.2M for the prior year-to-date period. Sports wagering gross revenue reported by casinos, racetracks, and their partners was $61.6M for May, reflecting a 16.4% increase when compared to $52.9M in the prior period. Sports wagering gross revenue reported by casinos, racetracks and their partners was $269.4M for the year-to-date, reflecting a 9.3% decline when compared to $297.1M for the prior period.
Caesars director Don Kornstein purchased 5,000 shares of company stock for $39.48 per share between June 13 and June 14, for a total transaction amount of $197,419.
Bragg Gaming (BRAG) has further secured its foothold in Ontario through the recent addition of its content to three of SkillOnNet's operator brands, just weeks after entering the newly regulated market, the company announced. Bragg Gaming also announced that it will appoint Yaniv Sherman as the company's new CEO, effective July 1. Sherman brings to Bragg more than 20 years of experience in leading global teams across the gaming, software and online gaming sectors, including, most recently, 15 years as a senior executive at 888 Holdings (EIHDF). The company also announced that Sherman's appointment marks the conclusion of the board of directors' review of strategic alternatives, which was announced in November 2021.
Meanwhile, Maxim analyst Jack Vander Aarde initiated coverage of Bragg with a Buy rating and $12 price target. The company has quickly gained scale and finished 2021 with a total of 146 customers, up from 101 in prior year, the analyst told investors in a research note. Vander Aarde added that Bragg's recent acquisition of Spin Games will accelerate the company's North American expansion strategy while noting that its cash position will keep the company from needing additional capital.
DraftKings (DKNG) and BetBlocker announced their collaboration to advance awareness of, and access to, BetBlocker's "acclaimed" software. Consumers using BetBlocker are able to set restrictions on their gaming activities across all of their devices at no cost to them, and these restrictions will apply across thousands of gaming sites, whether regulated or not, anywhere in the world. "BetBlocker's contributions to safer play are commendable and DraftKings is pleased to team up with this enterprising and disruptive not-for-profit that is advancing responsible gaming in a comprehensive and consumer friendly way," said Chrissy Thurmond, Senior Director of Responsible Gaming, DraftKings. "We share BetBlocker's vision that technology and innovation are critical to promoting safer play, and we extend a warm welcome to BetBlocker as they build their footprint in North America, following widespread success across the pond." Developed in the U.K., BetBlocker is the first and only no-cost tool that enables individuals to set restrictions on their play on all of their personal devices.
Gan Limited (GAN) announced that its board of directors has authorized an extension of the previously authorized share repurchase program which permits the company to purchase up to an aggregate of $5M of its ordinary shares on the Nasdaq Capital Market. The program's expiration date has been extended to November 30, 2022.
Elys Game Technology (ELYS) announced that it has entered into a definitive agreement with a single institutional investor for the purchase and sale of 3,166,227 shares of the company's common stock at a purchase price of $0.9475 per share of common stock in a registered direct offering. The closing of the offering is expected to occur on or about June 15, 2022, subject to the satisfaction of customary closing conditions. In addition, in a concurrent private placement, the Company also agreed to issue to the investor warrants to purchase up to 3,166,227 shares of common stock. The warrants have an exercise price of $0.9475 per share, are exercisable six months from the date of issuance, and have a term of five years from the initial exercise date.
TIME IS TICKING: Despite pressure from Governor Larry Hogan, regulators still provided no timeline for the launch of online sports betting in Maryland, Pat Evans of Legal Sports Report wrote. Governor Larry Hogan released a letter calling on the legislature’s Sports Wagering and Application Review Commission, or SWARC, to take immediate actions to launch mobile sports betting in the State of Maryland, noting the significant public outcry in response to a series of needless bureaucratic delays. In his letter, the governor called for:
SWARC met Thursday and provided some updates, but no definitive timeline for online sports betting in Maryland was provided. The meeting also included a response from SWARC Chairman Thomas Brandt to Hogan, who published a letter Wednesday urging an online launch by Sept. 8. “I understand many are frustrated that the process of the issue has been time-consuming,” Brandt said while detailing the legal hurdles the commission is navigating. “I also want everyone to know that SWARC and its support team have been working as diligently and deliberately as we can. SWARC is and has been working through these legal requirements.”
DON'T TOUCH THAT DIAL: From September 2021 through May, U.S. sports betting operators spent an estimated $282M on TV advertisements, according Evans, citing an iSpot.TV report released last week. The advertising had more than 18B impressions. Spending jumped 281% and impressions 48.4%. The growth is expected to continue, but not at the same level, according to Tyler Bobin, a senior brand analyst at iSpot. Reportedly, the top 5 brands by ad impressions are:
FanDuel CEO Amy Howe told the Wall Street Journal that it does not plan to curb its spending. Caesars Sportsbook accounted for 66% of the estimated national ad spend, according to iSpot. That spending made up 51% of the ad impressions during that time. NFL programming attracted 42.5% of the ad impressions during the football betting season., while the NBA ranked second with 7.9% of ad impressions. Sports betting was the 88th category on iSpot’s list of advertising impressions between cruise lines and cosmetic fragrances.
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 National (PENN), Rush Street Interactive (RSI) and Wynn Resorts (WYNN).