Shares of Montreal-based online gaming company Stars Group Inc (TSX:TSGI)(NASDAQ:TSG) were up 8.73% midway through the noon hour on September 15. The company revised its financial results the same day which saw second quarter revenues increase 6.8% and excluding foreign exchange rates it was up 7.9%. Online poker revenues were down 5.9%, but online casino and sportsbook revenues climbed 50.2% to $89.2 million.
Stars Group stock has now increased 21.8% in 2017 and 12.5% year over year. When it was formerly known as Amaya Inc. the company made a splash in 2014 by acquiring the parent company of Pokerstars and Full Tilt Poker, which made it the largest online gaming company listed on a stock exchange. The popularity of online poker has dissipated somewhat in recent years, and as the financials show this has ceded to an enormous boom in sports betting.
The Supreme Court is set to rule on a U.S. federal ban on sports betting that could see the industry explode if it is overturned. Offshore sports betting is estimated to be an industry that could reach over $100 billion annually. A new report by GamblingCompliance estimates that gross gaming revenue could reach $2 billion in the U.S. within 5 years of sports gambling legalization.
Stars Group has seen over 200% growth in a 5 year period. Investors should keep an eye on the developments within the U.S. that could see the company’s revenue explode in the coming years.
