It is an evident fact that sports betting is quickly rising the ranks to become one of the world’s most well-established hobbies. Males naturally participate in it the most, and the majority of them do so with the aim of profiting from it by using their comprehensive knowledge of sports and years of gained intuition in projecting the outcomes of sporting events to good use. According to a Zion Market Research assessment, this habit will generate $131 billion in revenue worldwide by 2023. According to the same estimate, this figure is likely to climb by $48 billion over the next seven years.
There are currently many billion-dollar-plus enterprises fighting to recruit as many US bettors as possible, which should result in the US market alone is worth $37 billion by 2025. According to their earnings reports, MGM Resorts International, situated in Nevada, is by far the most significant participant in this industry in North America, with up to double the market share of their key competitor DraftKings.
Furthermore, MGM Resorts International is the world’s largest player in this industry. This is an odd situation, given that DraftKings was recently recognized as the most profitable sports betting operator in the United States. However, recent events have not been kind to them, as seen by the gradual decrease in their company’s stock values following the end of the summer months. To the point that, as this piece is being written, their current price is $44. This represents a $28 decline from the price of a share of DraftKings stock in March of this year.
Despite the fact that numerous organizations engaged in this industry have recorded big losses, there is no doubt that this sector has the potential to earn exceptionally large profits. Even while losing a market share is never a good thing, analysts remain optimistic that DraftKings will be able to rebound from its recent setbacks, becoming competitive again and potentially even passing MGM Resorts. As online casino gaming gets more popular in many parts of the world, it is feasible that these companies will make it possible to play games comparable to the slot machines seen in Las Vegas online in the not-too-distant future. They would be able to greatly boost their revenue as a result of this.
Will MGM maintain its current dominance in the industry?
In an article released by InsiderMonkey in August 2021, MGM Resorts was named as the tenth greatest company to purchase right now. This article included a list of the top ten best stocks to buy right now. One of the key reasons for this expansion is the BetMGM brand, which was created in 2018 as a consequence of a partnership between UK-based Entain Holdings and MGM Resorts and is meant to modernize online gambling in North America.
Despite the fact that sports betting websites currently have a higher profile due to their affiliations with well-known sports leagues, it is more profitable to operate an online casino or an interactive gambling platform than a sports betting website. BetMGM has collaboration agreements with professional sports leagues and teams such as the Philadelphia 76ers and Germany’s Borussia Dortmund.
These MGM businesses are still not profitable in a significant way, despite the fact that MGM has significantly expanded its online presence. The land-based properties owned by the corporation are the primary contributor to the revenue that is generated by the business. If all of MGM Resorts’ properties are once again able to operate at full capacity and there are no longer any safety restrictions, the company’s revenue should increase dramatically. BetMGM anticipates that its sports betting operations will generate revenue of approximately $200 million during the third quarter of 2021. It was able to capture a 23 percent market share in the iGaming and sports betting industries over the course of the three months leading up to August of this year.
Is it possible at all that DraftKings will make a comeback?
DraftKings is the most well-known and widely used operator of fantasy sports in the United States. The company was established in 2012 and has maintained its position since then. They came to the conclusion in 2018 that they wanted to broaden their operations within the sports betting industry in order to capitalize on the ever-increasing demand for wagers on sporting events. In order to accomplish this goal, they initially established an online sportsbook in the state of New Jersey before expanding into a number of other states.
In the year 2020, they were able to transform themselves into a publicly traded company by completing a reverse merger with Diamond Eagle Acquisition Corporation and SBTech Global. They were able to acquire the Vegas Stats & Information Network, a sports betting broadcaster, thanks to the transaction that took place this year. A number of states across the United States are now serviced by DraftKings’ retail and online sportsbooks thanks to the company’s recent expansion. In addition, they provide users with access to a Digital Sports Collectibles Marketplace, where they are able to make purchases of NFTs depicting famous athletes like Tony Hawk and Wayne Gretzky.
This company is still a fantastic long-term investment, despite the fact that there is a good chance that DraftKings stock prices will go down in the second half of 2021. This is due to the fact that it is a reputable brand that has also shown substantial progress in terms of revenue growth. As a consequence of this, there is no possible way under any circumstances that it will ever fall out of the top three most influential players in the betting market in the United States in the near future.
In addition, buying the company’s shares while they are trading at a discount may prove to be profitable in the long run. It continues to make investments in cutting-edge technologies and in the promotion of its brand, thereby ensuring that it will bring in an ever-increasing number of clients in the years to come. It is impossible to say with any degree of certainty whether or not it will be able to outpace BetMGM by the year 2022.
