Wall Street Bets is a roundup of recent notes from analysts covering the gambling industry.
Dan Politzer of J. P. Morgan on October 18 looked at what intrigues investors:
“Post the 23% average pullback in 3Q26 for our gaming coverage, there’s been a modest uptick of inbounds from a broad array of investors, including long only’s, deep-value funds, and generalists. The stocks that have garnered the most interest are Wynn, DraftKings and Flutter; while our view has been that regionals are the best house on the block. Investors with duration are more focused on buying stocks that offer some combination of asset quality, growth, and/or optionality over the next 12 months. In the case of DraftKings/Flutter, they check the boxes for both growth (with or without prediction markets) and optionality (clarity on prediction market regulations), and there was also some discussion re: potential for M&A given how depressed valuations have become (i.e., are there private operators that could be interested in acquiring increasingly discounted public operators?).”
David Katz of Jefferies on October 14 also examined investor interests:
“The most prevalent inbound calls this week were on gaming stocks, which were generally mixed for the week (Large +2.8%, Small-Mid Capitalization -0.4%), why valuations are historical lows and whether they are worth buying. From a trading perspective, the leveraged names and underperformers are worth a long trade, in our view: Las Vegas Sands, MGM, Boyd, Penn Entertainment. In the case of Las Vegas Sands and Boyd, there has already begun some buy-side trading with the shares up 4.9% and 1.4% for the week, respectively. With these stocks at historical lows of 5.5X-6.5X EBITDA, we expect valuations should normalize and the weakness in Las Vegas Sands, MGM quarters should be well understood, while Penn Entertainment, Boyd should have solid reports. Nonetheless, we make a clear distinction between a long trade that should work on oversold names vs. fundamental long-term growth/value creation. At present, we view these names as more former than latter.”
Macquarie’s Chad Beynon on October 14 looked at prospects for BetMGM:
“BetMGM reported a solid 3Q26 update that reinforces the success of its value-over-volume strategy, with disciplined execution continuing to drive profitable growth despite an intensely competitive environment. Net revenue +7% year-over-year to $710 million, including +6% growth in igaming and +7% in OSB, while EBITDA more than doubled to $86 million (+112% year-over-year). Management reiterated FY26 guidance, on track to deliver toward lower end of its $2.9-3.1 billion revenue range and $300-350 million of EBITDA, while maintaining confidence in a longer-term path to $500 million of EBITDA. Importantly, management noted that business trends remained healthy through September and continued into October.”
