Online gaming stocks have taken a big hit in recent months, and Bank of America analyst Shaun Kelley said Monday that the U.S. online sports betting market had a surprisingly weak month in December.

Kelley said December online sports betting (OSB) gross gaming revenue (GGR) came in at an annual run rate of just $180 million, down 45% month-over-month. By contrast, December U.S. iGaming GGR was up 11% month-over-month to a record $384 million.

The Numbers: Total digital GGR in December was down 16% month-over-month and up 74% year-over-year to a $563 million annual run-rate, Kelley said Monday. The overall December numbers were negatively impacted by just a 5.5% hold in OSB, the second-lowest monthly rate of 2021.

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“Overall, Q4 OSB hold is running at 7.3% (as November was very strong) vs. 7.8% for the first 9 months of 2021,” Kelley said.

Major Markets: At this point, the lion’s share of the OSB and iGaming market share is concentrated in just a handful of top names. In fact, in the top three OSB states (New Jersey, Pennsylvania and Michigan), the top five companies generate about 90% of the total GGR, Kelley said.

Flutter Entmt ADR (OTC:PDYPY) subsidiary FanDuel was still the market share leader in OSB in the top three states in December, accounting for 45% of total GGR.

Draftkings Inc (NASDAQ:DKNG) was a distant second in those three markets with 22% OSB market share, but DraftKings gained 1% share in December while FanDuel's share was steady.

MGM Resorts International (NYSE:MGM) had the third-highest OSB market share at 17%, up 6% compared to November.

Penn National Gaming, Inc (NASDAQ:PENN) subsidiary Barstool’s OSB share remained steady at 8% of the total.

Caesars Entertainment Inc (NASDAQ:CZR) OSB market share was up 2% month-over-month to 5%.

Benzinga’s Take: DraftKings, MGM and FanDuel are the three clear national market share leaders in both OSB handle and iGaming GGR. In the past three months, Flutter shares are down 25%, DraftKings stock is down 57.8% and MGM shares are down 14.7%.

Photo: Courtesy of Baishampayan Ghose on Flickr