Latest Business News
ESPN Dives into Online Betting: A New Era for the Gambling Industry
The sports broadcasting giant ESPN, a division of Disney, has announced its entry into the world of online betting. In a strategic partnership with Penn Entertainment, ESPN is set to rebrand and relaunch Penn's online sportsbook, formerly known as Barstool Sportsbook, as ESPN Bet. This new venture, which will be operated solely by ESPN, is set to debut this fall in the 16 states where Penn is already licensed.
ESPN's Entry: A Potential Boost for the Gaming Industry
This move by ESPN into the online gambling sector could potentially trigger a new wave of growth for gaming companies already operating in the industry. During the Covid-19 pandemic, several gaming companies experienced record stock market performance as interest in at-home and mobile gaming surged. Penn shares, for instance, saw a dramatic increase in 2020, soaring by 238% before experiencing a downturn in 2021 and 2022.
Positive Outlook for Penn and the Online Gaming Sector
The partnership with ESPN could bring particularly good news for Penn, as it not only boosts the company's profile but also expands the entire online sports betting universe. This could potentially enhance the sentiment toward other online gaming companies. Following the announcement of the ESPN-Penn deal, Penn's shares rose by more than 18%.
Wall Street's Favorite Gambling Stocks
In the wake of the ESPN-Penn deal, CNBC Pro conducted a search for some of Wall Street's favorite stocks in the gambling industry. The search focused on gaming stocks that have buy recommendations from at least 60% of Wall Street analysts covering them and that have consensus stock price targets for the next 12 months at least 10% above their current trading prices.
Rush Street Interactive: A Stock to Watch
One of the stocks that emerged from this search was online sports betting operator Rush Street Interactive. According to FactSet data, the analysts' average price target for this stock would translate into a potential upside of more than 56%. Shares of Rush Street have risen by 12% so far this year and by 5.4% in August alone. Despite falling short of the Street's expectations for second-quarter earnings per share, the company beat revenue estimates and raised its full-year financial guidance.
Caesars Entertainment: A Promising Prospect
Caesars Entertainment also appeared on CNBC's list. Analysts expect the company's shares to gain 29% over the next 12 months. The gaming and hospitality supplier reported second-quarter revenue that matched analysts' expectations and expressed optimism for the growth outlook of its iCasino products. Despite a slight dip in its share price this month, the company's shares have rallied by 34.5% so far this year.
Boyd Gaming Corporation: A Las Vegas Favorite
Analysts are also optimistic about Las Vegas-based Boyd Gaming Corporation. The company's shares have risen almost 24% so far this year, and analysts are projecting nearly 19% upside based on consensus price targets. During its second-quarter earnings conference call, management reported consistent non-gaming revenue trends and potential for revenue growth in Las Vegas.
In conclusion, ESPN's entry into the online betting arena could potentially reshape the gambling industry and impact the performance of various gaming stocks. As the landscape of online sports betting evolves, it will be interesting to see how these developments play out in the market.
Conclusion: The Impact of ESPN's Entry on New Businesses
ESPN's foray into online betting could potentially revolutionize the gambling industry, bringing about significant changes and opportunities. For new businesses, especially those venturing into the online gaming sector, this development could serve as a catalyst for growth and expansion.
Opportunities and Challenges
On one hand, ESPN's entry could stimulate the online betting market, creating a more favorable environment for new businesses to thrive. The increased interest and visibility brought about by ESPN's presence could attract more users to online betting platforms, potentially benefiting all players in the industry.
On the other hand, ESPN's entry also presents new challenges. The competition in the online betting market is set to intensify, and new businesses will need to differentiate themselves to succeed. This could involve offering unique betting options, enhancing user experience, or implementing effective marketing strategies.
The Importance of Adaptability
In this rapidly evolving landscape, adaptability will be key for new businesses. They will need to stay abreast of market trends, adjust their strategies in response to changes, and seize emerging opportunities. As the online betting market continues to evolve, it will be interesting to see how new businesses navigate this dynamic environment.
Article First Published at: https://www.cnbc.com/2023/08/09/wall-streets-gambling-picks-as-espn-jumps-into-online-sports-betting.html
Brought to you by ChatGPT for www.BusinessFormation.io.svg)
