Atlantic City casino wins were up more than 9 percent in January year-over-year, according to new state figures, but the real jackpot in the state may have come courtesy of online sports betting.
New Sports Revenue
In a look at the latest state numbers from New Jersey on gaming revenues, Credit Suisse analyst Cameron McKnight said internet sports betting, which launched in the fall, made up by far the bulk of the sports betting handle.
Figures released by the New Jersey attorney general show that bettors made just under $305 million in sports bets through New Jersey’s 11 online sportsbooks, making up nearly 80 percent of the total sports betting handle for the month. New Jersey’s 10 online retail sportsbooks accounted for the rest.
The total New Jersey January sports betting handle of $385.3 million — representing a lot of betting on the NFL playoffs — was up nearly 21 percent over the online and retail sportsbook handle in December.
The internet share is better than more mature markets like those in Great Britain and Australia, McKnight said in a Wednesday note. And it could get better.
“It’s still early days for sports betting in New Jersey — participants are yet to launch a full suite of products,” the analyst said.
Stocks To Watch
Credit Suisse initiated coverage on gaming in August and said it expects the legal sports betting market in the United States could reach $4.5 billion in gross revenue, but not until 2023.
“We think the market will take time to legalize, overcome regulatory/legal/political hurdles in some cases and for the ultimate structure to work itself out,” McKnight said.
The analyst highlighted two New Jersey casino stocks, noting that Caesars Entertainment Corporation CZR saw its share of casino revenues rise 94 basis points, while the revenue share for MGM Resorts International MGM was up 32 basis points.
Caesars reported a year-over-year casino win drop in January, coming in at $17.1 million, down from $21.7 million in January 2018.
Credit Suisse has an Outperform rating on Caesars with a $13 price target, and a Neutral rating on MGM with a $30 price target.
Caesar's was trading down more than 1 percent at $9.28 Thursday afternoon. MGM was trading down more than 6 percent following an after-hours spike Thursday, when it reported better-than-expected fourth-quarter revenue.
According to filings from the New Jersey Division of Gaming Enforcement, overall gaming revenue in the state — including casino win, internet gaming win and sport wagering revenue — reached $220.6 million in January, up 19.7 percent from January 2018.
The casino win was $177.3 million, up 9.2 percent over January 2018, but was aided by the addition of two new casinos: the Hard Rock and Ocean Resorts.
The internet gaming win was $33.6 million, up 53 percent from $22 million in that category a year ago. Sports betting revenue in the month was $9.75 million, with no comparison, as it was illegal one year ago.
New Jersey won a U.S. Supreme Court case last spring allowing states to legalize sports betting if they choose. So far, eight states, including New Jersey, have made sports betting legal.
Related Links:
What's The Over-Under On The First Legal Super Bowl Betting Market?
Credit Suisse: Caesars Entertainment Has Ideal Position In Vegas, Regional Gaming
Photo by Truff Stuff/Wikimedia.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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