So why is the stock market
not reflecting this renaissance period? A review of the leading sports betting
companies and gaming operators stock prices show dismal results over the past 6
months. While the amount of money wagered is staggering, the investors in the
companies are seeing red digits on their portfolios.
While the slide could be
due to global inflation, there are long term profitability concerns for the
industry. Look for a merger or acquisition as a way for one or two operators to
turn things around. CNBC Jim Cramer stated “But as we
see what the reality looks like, there’s tons of competition for market share
and little in the way of profits. Too bad because profits are what this market
wants right now. That is why every single one of these stocks has been
obliterated,”
According to
Yahoo Finance, MGM Resorts International announced an offer to acquire the
global gaming company Leovegas. MGM is attempting to build on the success of BetMGM in the United States with this acquisition allowing them to expand
globally with an omnichannel strategy. I also found that MGM, as part of
the Maryland Education Summit for Sports Betting, will offer a mentorship
program to a qualified applicant that is pursuing a Class C sport betting license. This week, MGM was approved for a takeover of the Cosmopolitan amid questions about a monopoly
on the Las Vegas Strip. MGM International is making progressive moves and has a
stock price of 36.56.A year ago it was $51.17.
Any organization
that has an established following on social media, does a high volume of sales and
is known internationally may want to purchase a gaming company as a caveat to
provide entertainment value to their customers. Imagine if Google or Facebook
decided to offer sports betting to their followers. They would have to gain the
trust of the public in a manner comparable to Uber and Disney. The patrons would
have to be comfortable sharing their banking information and be guaranteed an
enjoyable experience that is not based solely on winning.
Since gaining
market share is the driver for the more renown operators, the winner of the
Sports Betting race will be the operator with a brick-and-mortar venue in cities
with a large population along with online gaming presence. The operator that
provides visual content of the event to coincide with in game wagering will
corner the market.
Check out my
articles about sports betting in IGaming Player & Bettors Insider. Follow
me on Twitter and Instagram.
