Wall Street gaming analysts have long watched the ebbs and flows of Super Bowl wagering.
Sunday’s game between the Los Angeles Rams and New England Patriots has taken on a unique perspective. Sports betting is now legal in seven states, in addition to Nevada, so the focus is not just on the Las Vegas Strip.
This year, for the first time, casino operators, including MGM Resorts International, Caesars Entertainment, Boyd Gaming Corp., Penn National Gaming, Eldorado Resorts and sports book operator William Hill US, will take action on Super Bowl LIII in New Jersey, Mississippi, Pennsylvania and other gaming markets.
“The Super Bowl is the most wagered (sporting) event of the year,” said Macquarie Securities gaming analyst Chad Beynon. “While we usually focus on the wagers on the Strip, this year will be different, with legal betting options in several states.”
Last year, Nevada sportsbooks attracted a record $158.5 million in Super Bowl wagers, according to the Gaming Control Board. Nevada sportsbook operators said gambling on Sunday’s game at Mercedes-Benz Stadium in Atlanta will exceed 2018’s numbers.
According to state regulators, wagering on the Super Bowl has increased in nine out of the last 10 years.
Soon after the Super Bowl LIII matchup was set, the Vegas Stats & Information Network (VSiN) predicted the nationwide betting handle on Super Bowl LIII would be roughly $320 million, including Nevada and outside markets.
The U.S. Supreme Court’s decision last May to strike down a federal ban on sports betting began a wave of activity that has continued into 2019, with 15 states currently considering sports betting legislation. The Super Bowl has become a test case for the activity.
“We expect Super Bowl parties within the casinos to be a positive first quarter visitation driver, while expected wagers will increase,” Beynon said. “From the beginning of the (Professional and Amateur Sports Protection Act) repeal, management teams have pointed to increased visitation as a positive result of sports gambling.”
Sportsbooks are considered an amenity in the casino industry.
Take Nevada, for example. In 2018, casinos statewide collected $11.9 billion in gaming revenue. Sports betting accounted for a relatively small $301 million of that total, though that figure set a single-year record and was a 21 percent increase over 2017. Gamblers wagered $5.01 billion on sports in 2018, which was also a single-year record in Nevada.
“While sports book revenue rarely moves the needle for the Strip hotels, it can sway results for local operators,” Deutsche Bank gaming analyst Carlo Santarelli told investors in a research note. “The Super Bowl marks the first major betting event of 2019 for the books and early on it appears to have created some risk, though, again, sports books risk is tightly managed.”
In a 28-year-span, Santarelli calculated, Nevada sports books have taken 7.3 percent of all wagers. For last year’s Super Bowl, an upset win by the Philadelphia Eagles, Nevada sportsbook operators held 0.7 percent – almost $1.2 million – of the bets on the game.
Going into Sunday, Nevada sportsbook operators have said the bulk of the money being wagered is on New England, which began as either a 1-point underdog or a pick’em but was quickly bet up to anywhere from a 2.5-to 3-point favorite. The total points on game – over or under 58.5 points – was bet down to 56.5 points.
“Most industry insiders note that roughly 80 percent of the total wagers will come in during the Friday-Sunday period, with the public bettors traditionally favoring the favorite, in this case New England, and the over,” Santarelli wrote. “As such, we believe come game time, bookmakers will be rooting for a Los Angeles and under combination.”
The American Gaming Association released a study last week estimating that almost 23 million Americans are expected to wager an estimated $6 billion on the game. The vast majority, however, will be placing the bets illegally, either through a corner bookie or off-shore betting operations accessed through the Internet.
“Wagering on the Super Bowl is embedded into the fabric of the American culture,” said AGA Senior Vice President of Public Affairs Sara Slane.
Beynon suggested the U.S. illegal sports betting market will eventually decline as regulated sports betting expands into additional markets, a narrative espoused by the AGA.
“As more states legalize, we expect for the mix to adjust, while the viewers may incrementally choose to watch at a casino,” Beynon said.
Howard Stutz is the executive editor of CDC Gaming. He can be reached at hstutz@cdcgamingreports.com. Follow @howardstutz on Twitter.
