The 3 Largest Gambling Stocks in 2020
The gambling industry is in turmoil right now, but the world of online gambling is thriving. The return of live sports has made online sports gambling a perfect outlet for those looking to scratch their gambling itch. 23 states have already legalized sports betting, with 41 expected to do so by 2022.
Las Vegas Sands is the largest gambling stock in the world. It has a market capitalization of $34 billion and an enterprise value of $45 billion. LVS recorded big losses in second quarter. About 60% of company profits come from Macao, China, and 31% from Marina Bay Sands resort in Singapore. The company has over 18 months of liquidity and no meaningful debt maturities until 2023. Its share price is about 12.8 times 2019 earnings. L VS is still about 40% below its all-time highs.
Caesars Entertainment is the largest gaming operator within the United States. Eldorado Resorts bought Caesar's for $23 billion on July 20. The merger is expected to bring several advantages to the company. However, the combined company will have about $15.5 billion in debt and the recent COVID-19 quarantines are likely to take their toll on revenue and losses. However the Nevada Gaming Control Board released casino data for June that wasn't as bad as feared. Las Vegas Strip casinos performed the worst, but more local Reno casinos reported a 6.84% decline in June winnings compared to last year.
Flutter Entertainment is the owner of FanDuel, a popular fantasy sports and sports betting app. Flutter is also a major player in the growing world of online gaming. The company recently completed its merger with The Stars Group. It acquired Poker Stars, SkyBet, BetEasy and FoxBet. The combined company is targeting 140 euros in deal synergies. Online gaming has grown at a 10% annualized growth rate for the five years through 2019. However, it still has only 12% share of total gambling spend globally. Las Vegas Sands, Caesars and Flutters are the three largest companies in this sector.