GAN Reveals Penn Interactive as New Client, Stock Soars Again
Posted on: August 20, 2020, 09:35h.
Last updated on: August 20, 2020, 01:28h.
GAN Ltd. (NASDAQ:GAN), the maker of cloud computing software for the gaming industry, is soaring again Thursday after the British company said Penn National Gaming’s (NASDAQ:PENN) Penn Interactive unit is a new client.
Penn’s mychoice social casino app will be powered by GAN’s Simulated Gaming software. The gaming offering is an offshoot of Penn’s mychoice player rewards program, which has more than 20 million members.
News of the agreement with Penn Interactive is exciting GAN investors, as the stock is higher by more than seven percent at this writing on volume that is poised to eclipse the daily average. GAN shares, which are up nearly 23 percent over the past week, jumped to their highest levels since late June on the Penn news.
Social gaming can set the stage for live money wagering, and with Wall Street consistently highlighting the opportunities in the internet casino market, it’s not surprising GAN is surging today.
Simulated Gaming is a core offering of GAN, which enables casino operators to provide social gaming offerings to players in states in advance of real money iGaming, providing meaningful marketing and revenue opportunities for both operators and GAN,” according to the technology company.
Financial terms of the deal weren’t disclosed.
Stacking Up Deals
Since listing in the US in May, GAN stock is developing a reputation for being positively levered to client acquisition news.
For example, the shares surged 7.66 percent on Monday after the company said Cordish Gaming Group debuted the “PlayLive!” online gaming business in Pennsylvania, a product backed by GAN software. That was after the shares jumped 12.65 percent four days earlier, when GAN discussed the deal at an investor conference.
In June, the company teased investors with talk of a “tier one” client that could mean $300 million to $400 million in annual revenue. There’s been ample speculation as to what operator GAN could be referring to, and it’s probably not Penn, because the cloud computing software publicly stated that revenue estimate and today’s announcement about the deal with Penn Interactive doesn’t include sales forecasts.
Still, Penn is the largest gaming operator to date to select GAN as a software provider. The company runs 41 casinos in 19 states. With that geographic reach, Penn is positioned to capitalize on increased legalization of online casinos and sports wagering.
Penn Pops, Too
Penn is the 17th US casino operator to license GAN software. The US accounts for approximately 80 percent of the technology company’s revenue.
Shares of Penn are in rally mode today, too. But traders are saying it’s not just the GAN news that’s propelling the stock higher.
Barstool Sports founder David Portnoy, who speculated on Wednesday that he might have the coronavirus, is reportedly feeling better today. Penn stock retreated yesterday on that news. But it is recouping those losses and then some today.
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