Gaming stocks in the United States and Canada have flown somewhat under the radar in a year defined by trade and geopolitical tensions, fiery debates over the role of Big Tech, and the promise of recreational cannabis legalization right here at home.
The decision by the U.S. Supreme Court in May to strike down a 1992 federal law that prohibited sports gambling has paved the way for legalization across the country.
The Stars Group Inc. (TSX:TSGI)(NASDAQ:TSG) stock has climbed 27% in 2018 as of late afternoon trading on August 29. This is in spite of a significant dip the stock has suffered since late July.
Stars Group celebrated the Supreme Court decision back in May and has already made inroads in the states of Pennsylvania and New Jersey which are quickly moving to legalize sports betting.
Eldorado Resorts Inc. (NASDAQ:ERI) has also had an incredible run with the stock more than doubling up over the past year. The company possesses resorts in Nevada, the sole state that has had legal sports gambling for some time, and has significant footprints in Missouri and Pennsylvania. In the second quarter its adjusted EBITDA rose 12.7% year-over-year to $118 million.
The new NFL season will be a fascinating case study in determining how quickly legal sports betting can get off the ground in the first few years.
Football draws the most bettors in the United States and Canada. Of the two discussed today, Stars Group boasts the most enticing price after its late summer plunge.
