The sports betting industry has never been so positive. The Supreme Court’s ruling this week lifting the ban on sports betting has sent casino giants and game-equipment makers raving, as well as scrambling to establish a competitive advantage. Scientific Games Corp (SGMS) and International Game Technology (IGT) will be the biggest beneficiaries of the ruling, with orders for slot machines and other gambling products now expected to pour in from different parts of the country.
Earlier, only select places such as Las Vegas aka the gambling capital of the world had legalized betting. The latest court ruling, which was instigated by a petition by New Jersey, will open up an industry that is estimated to be worth as much as $150 billion. New Jersey, New York, Santarelli, West Virginia and Pennsylvania are expected to be among the first cities to allow commercial betting operations since they already have legislation in place allowing it.
The market was quick to respond to this news. MGM Resorts (MGM), Boyd Gaming Corp (BYD) and Scientific saw significant gains once the reports confirming the ruling were out. While Penn National (PENN), which operates racetracks and casinos, touched a record high on the news, Caesars Entertainment registered 6% progress.
Even sports teams and organizations have something to cheer about as they expect to earn more through wagering than from television or media rights. Fittingly, investors sent shares of Madison Square Garden (MSG), which owns hockey team New York Rangers and basketball team New York Knicks, over 5% since the ruling.
While there are no doubts that the latest development has opened up a new avenue of investment opportunities with a panoramic scope, the regulation and legalization processes could end up being long and wound up, with a lot of ambivalence surrounding it. Since different states will be setting up their own legislation for sports betting, it is likely to create a lot of confusion before everything settles into place. And these volatilities are expected to reflect in the stocks as well.
But if you are ready to make a gamble, a jackpot could be in the offing.
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