The current NFL season has sparked significant interest in sports gambling stocks as Americans are predicted to place $35 billion in bets on NFL games this year. This remarkable figure highlights a considerable increase from the previous year’s $26.7 billion. Investors are keenly observing potential returns from gambling stocks, driven by the league’s unmatched popularity that consistently draws substantial wagers. The fervor surrounding NFL betting positions certain stocks as attractive investment opportunities.
In recent analyses, sports betting has become increasingly prominent, with the NFL leading as a major catalyst. Historically, the league has seen a growing trend in betting, supported by liberalized gambling laws and technological advances in online betting platforms. The shift from traditional betting to online platforms has also contributed to increased participation. This evolution in the betting landscape presents a fertile ground for investment, as seen in previous seasons where sports betting stocks experienced notable volatility yet substantial growth potential.
How is DraftKings Positioned?
DraftKings (NASDAQ:DKNG) remains a key player in the sports betting market, possessing a 70% revenue share with FanDuel. Investors find DraftKings appealing due to its strategic positioning in the online sports betting arena. Analysts, including those from Needham and Macquarie, have reiterated buy ratings, highlighting DraftKings’ potential to capitalize on favorable NFL outcomes and overall market momentum. Additionally, the company’s recent $1 billion buyback program and improved revenue guidance underlie its robust market stance.
What About Flutter Entertainment?
Flutter Entertainment (NYSE:FLUT) has been identified as another significant entity, especially after a recent downturn due to potential tax hikes in the UK. Analysts at Benchmark view the stock’s dip as a buying opportunity, supported by Wells Fargo and Bank of America, who have issued favorable ratings and price targets. Such endorsements underscore Flutter Entertainment’s resilience and potential for future gains, particularly with its inclusion in strategic investment lists.
For those seeking diversification, the Sports Betting & iGaming ETF (BETZ) offers a consolidated approach to investing in this sector. This ETF includes holdings in major companies like Flutter Entertainment and DraftKings, with a focus on tracking the Morningstar Sports Betting & iGaming Select Index. The ETF’s recent market performance shows it has significant support, suggesting potential upward price movement. With the expanding American interest in sports betting, BETZ is positioned well for potential growth.
As the NFL season progresses, the correlation between sports popularity and betting activities becomes even more apparent. The anticipated increase in betting volumes indicates a lucrative period for gambling stocks, with companies like DraftKings and Flutter Entertainment emerging as frontrunners. Their strategic positions and market adjustments suggest promising avenues for investment.
Investors should consider the dynamic nature of sports betting and its alignment with technological advancements. Monitoring this sector closely could reveal opportunities for substantial returns, especially as regulatory environments evolve and consumer behaviors shift. Staying informed on market trends and strategic company moves will be crucial for capitalizing on this vibrant sector.
