Score Media, Penn Among Potential Winners as Canada Moves Toward Single-Game Betting
Posted on: November 28, 2020, 12:53h.
Last updated on: November 28, 2020, 05:52h.
On Thursday, Canada’s Liberal Party introduced legislation that would end the country’s ban on single-game sports wagers. That sparked rallies in some equities with exposure to the country’s betting market.
Currently, Canadian gamblers can wager on parlays authorized by provincial lotteries. But betting on individual games is prohibited, prompting bettors to either use illegal local bookies, place action with offshore sportsbooks, or travel to New Hampshire, New York, Michigan, and Montana — the US states bordering Canada that allow sports betting.
The new legislation set to pass would address two important issues: (1) the law would legalize single-game sports betting and (2) it would allow other sports betting operators to enter Canada and create a competitive marketplace,” according to Roundhill Investments.
The New York-based exchange traded funds (ETFs) issuer estimates Canadian bettors have sent $15 billion offshore. Provincial lotteries have taken in just $500 million on the current parlay offerings.
Winners Already Emerging
On news of the Liberal Party’s evolving view on sports wagering, Score Media and Gaming (OTC:TSCRF), the operator of theScore and theScore Bet, stands out as an obvious winner. On Friday, the US-listed shares of that Canadian company vaulted higher by 64.77 percent on above-average volume.
Score, which was recently promoted to the Toronto Stock Exchange (TSE), is one of the few gaming companies that marries both wagering platforms and a media outlet under one umbrella. While the operator has a growing US footprint, including Colorado, Indiana, and New Jersey, its home country remains a vital market, levering it to progress on the single-game wagering issue.
“TheScore seems best-positioned to take advantage of the new regulations. TheScore, which currently trades on the Toronto Stock Exchange, is a leading sports media brand in Canada,” said Roundhill analyst Matias Dorta in a note.
Analysts at Canaccord estimate that Ontario, Canada’s largest province, could add almost $77 million in revenue for Score Media if wagering on individual sporting events is permitted.
Score projects the Canadian market could generate $2.92 billion to $4.15 billion in annual revenue if single-game wagering comes to life.
Already one of the hottest US-based gaming names this year, Penn National Gaming (NASDAQ:PENN) has exposure to the Canadian legislation because it has a 4.7 percent equity stake in Score via a market access agreement. Penn doesn’t operate any land-based venues north of the border.
In a note to clients Friday, Union Gaming analyst John DeCree points out Bally’s (NYSE:BALY) could be another beneficiary of the changing environment in Canada. That’s because Bet.Works, which Bally’s is acquiring for $125 million, is a “logical” partner for Score.
Other domestic operators that could get a lift in the Great White North include Caesars Entertainment (NASDAQ:CZR) and Century Casinos (NASDAQ:CNTY).
While Caesars is focusing intently on its US portfolio, it operates a namesake venue in Windsor, Canada. Century, which has a burgeoning sports betting footprint of its own in the US, runs six casinos and pari-mutuel venues in the western province of Alberta.
Related News Articles
Related News Articles
- March 13, 2021 — 15 Comments—