The Stars Group Inc. (TSX:TSGI)(NASDAQ:TSG) stock was up 0.93% in early afternoon trading on May 15. On May 14 the US Supreme Court strike down a 30-year ban on sports betting under the Professional and Amateur Sports Protection Act. Stars Group released a statement after the ruling was announced.
“The decision by the Supreme Court is an important step forward in the regulation of sports betting in the United States,” said executive vice president Marlon Goldstein. “We believe we are well-positioned to take advantage of any new business and market opportunities, and to work with state legislatures in setting up sports betting frameworks that satisfy local consumers’ interest in sports betting while protecting them through safe and regulated betting environments.”
The ruling comes less than a month after Stars Group acquired U.K.-based Sky Betting for $4.7 billion. According to Stars Group the purchase will create the biggest publicly-listed online-gambling company in the world and increase its market share in the business overall.
The Stars Group also released its first quarter results on May 10. Revenue surged 23.8% year-over-year to $392.8 million and net earnings rose 13.1% to $74.3 million. Adjusted EBITDA climbed 15.9% to $175 million.
It will still take time before casinos and online betting houses can take full advantage. The National Football League moved immediately to lobby Congress in an effort to establish a framework to guarantee the integrity of sports leagues going forward. Still, the legalization of sports gambling will provide a massive revenue stream going forward. Stars Group is a terrific long-term buy and hold.
