Wall Street Bets is a roundup of recent notes from analysts covering the gambling industry.
Noting the state’s 51% tax rate in a July 7 note, J. P. Morgan Analyst Joseph Greff reported that sports betting in New York yielded net revenue of $74 million in June.
“For handle market share, we note that DraftKings overtook FanDuel for the first time in 2023, with a sequential increase of 7 points while FanDuel decreased 6 points,” Greff wrote. “DraftKings had $489 million (42% share), while FanDuel had $418 million (36%), Caesars had $125 million (11%), and BetMGM had $75 million (6%).”
In a July 9 note, Jefferies Equity Analyst David Katz wrote about “the recent deceleration in BetMGM performance and the prospective future of joint venture partners MGM and Entain in the context of their ownership.
“With the six-month waiting period under UK merger law expiring on August 8th, the debate over whether MGM would pursue acquiring Entain again and how the market would receive such an event is activating again. Our impression is that it should remain topical for the near term, and it could be a strong positive for all concerned, depending on terms.
C. Patrick Scholes, Truist analyst, on July 6 commenting on RevPAR (revenue per available room) in the U.S. hospitality industry, noted that it was up 5.7% year-over-year for the week ending July 1 2023. RevPAR also was up 30.3% compared to 2019 and increased 12.2% compared to the prior week and “above the trailing 10-week average of +13.2%.
“July 4th falling on a Tuesday this year vs. a Monday last year likely pulled-forward some Group business into the week ending July 1st (for both 2023 and 2022, the July 4th holiday will fall in the comparable week),” Scholes wrote. “This was evident in Group RevPAR up 14.8% year-over-year last week, well above the running 28-day average of +3.9%.
“As a rule of thumb, if there are abnormal results in Group business, it is likely due to a holiday shift/timing.”
