Hot Features
Premium
Register for Free to get streaming real-time quotes, interactive charts, live options flow, and more.
The gambling industry in 2023 will continue to present enticing opportunities for investors, with several standout companies delivering impressive performances. In this article, we’ll take a closer look at five prominent gambling stocks that have been making waves in the market with their robust growth and strategic positioning.
Gambling stocks are volatile
Be cautious when investing in gambling companies, as history has proven, these stocks to tend be very volatile over a longer period. There is however an upside now to finding companies with longevity and accelerated growth as mission. As the US opened online gambling regulations in many states, with more to come, bigger companies are acquiring well established brands in Europe. LeoVegas, a Swedish-owned operator got acquired by MGM resorts to boost their online presence and they have been doing so with great success.
If you want to know more about online casinos, their operations, competitors, and products, we recommend visiting Casivo, an online casino guide with a focus on comparing online casinos and the companies behind them.
Light & Wonder, Inc.
Ticker: LNW
Formerly known as Scientific Games Corporation, Light & Wonder Inc. is a prominent designer of gaming content for casinos and related businesses. Notably, the company recently made a significant move to enhance its financial position by repaying $4.8 billion in debt, reducing its outstanding debt by an impressive 55%. This strategic decision reflects Light & Wonder’s commitment to improving shareholder value.
Despite the temporary contraction in quarterly earnings due to the divestiture of its lottery and sports betting businesses, Wall Street analysts remain optimistic about the company’s future. With a consensus Buy recommendation, 50% of analysts have issued a Strong Buy rating, indicating confidence in the company’s long-term growth potential.
Penn Entertainment Inc.
Ticker: PENN
Penn Entertainment Inc. stands as a prominent player in the gambling industry, offering a diverse array of entertainment, sports content, and casino gaming services. The company operates gaming properties nationwide and provides online sports betting services, catering to the growing digital gambling market.
PENN’s financial performance has been remarkable, with net income soaring tenfold in the first quarter of 2023. This exceptional growth can be attributed to PENN’s strategic acquisition of Barstool Sports, which has proven to be a significant revenue driver. Additionally, the company recorded a substantial $500 million gain from reclassified lease components, further solidifying its financial position.
With its strategic acquisitions and strong financial performance, Penn Entertainment Inc. continues to be an attractive prospect for investors seeking exposure to the flourishing gambling industry.
MGM Resorts International
Ticker: MGM
MGM Resorts International is a well-established global player in the gaming and entertainment industry, operating world-class resorts that offer accommodations, hospitality management, dining, and other services for both casinos and non-casino properties.
Benefiting from a rebound in leisure travel, MGM’s net revenue witnessed a remarkable increase of more than a third in the latest quarter. This significant growth was further supported by the company’s acquisition of the Cosmopolitan of Las Vegas, expanding its portfolio and increasing its market presence.
MGM Resorts International is well positioned to capitalize on the recovery in the tourism industry, driving further growth in its operations and financial performance.
Accel Entertainment
Ticker: ACEL
Accel Entertainment (NYSE: ACEL) holds the position of the second-best gambling stock, boasting a Zen Score of 50, which is 17 points higher than the gambling industry average of 33. The company has passed 17 out of 33 due diligence checks and has strong fundamentals. While Accel Entertainment has seen a stock return of 1.79% over the past year, it has underperformed other gambling stocks by -9 percentage points.
Churchill Downs
Ticker: CHDN
Churchill Downs (NASDAQ: CHDN) ranks as the third-best gambling stock with a Zen Score of 48, which is 15 points higher than the gambling industry average of 33. The company has passed 19 out of 38 due diligence checks and exhibits strong fundamentals. Churchill Downs has experienced a stock return of 22.7% over the past year, outperforming other gambling stocks by 12 percentage points.
Additionally, Churchill Downs has an average 1-year price target of $156.60, presenting an upside of 19.11% from its current stock price of $131.47. With a consensus Strong Buy recommendation from Wall Street analysts, 80% of analysts have issued a Strong Buy rating for Churchill Downs, further supporting its growth potential.
Gambling stocks are lucrative in 2023
In 2023, the gambling industry will offer promising investment opportunities for those seeking exposure to a dynamic and ever-evolving market. Light & Wonder Inc., Penn Entertainment Inc., MGM Resorts International, Accel Entertainment, and Churchill Downs have distinguished themselves with strong performances and strategic initiatives. Investors should conduct thorough research and consider their investment goals while navigating the market, as stock prices may fluctuate and carry inherent risks.
