Welcome to the latest edition of "Bet On It," where The Fly looks at news and activity in the sports betting and iGaming space.
SECTOR NEWS: Travelers arriving in China will spend less time in quarantine under new changes made to its anti-virus controls to reduce disruptions in its economy and society, The Associated Press reported. The news comes after an upsurge in COVID-19 cases that prompted Beijing to close its parks and impose other restrictions. Rather than being confined for seven days, incoming passengers will only be quarantined for five days at a designated location and then another three days at their place of residence, a notice from the State Council said, according to ABC News. It is not yet known when this new rule will take effect and if it will apply to foreigners and citizens alike. Similarly, those flying to China only need to show one negative COVID-19 test taken within 48 hours of traveling, down from two tests that were previously required. companies in the Macau gaming space that may be impacted by the news include Las Vegas Sands (LVS), Wynn Resorts (WYNN), MGM Resorts (MGM) and Melco Resorts & Entertainment (MLCO).
Shares of DraftKings (DKNG) were down in Wednesday trading after voters in California shot down two propositions to legalize sports betting in the state. Proposition 26, which would have legalized sports betting at tribal casinos, and Proposition 27, which would have more broadly legalized online and mobile sports betting, were both voted down. The latter was put on the ballot by sports betting companies such as DraftKings and Flutter Entertainment’s (PDYPY) FanDuel and opposed by Native American tribes.
SharpLink Gaming (SBET) announced that Dave Abbott, former Managing Director of U.S. Sports Media at Sportradar (SRAD), has been appointed as SharpLink’s new chief technology officer, effectively immediately.
In a regulatory filing, Caesars Entertainment (CZR) director Michael Pegram disclosed the purchase of 25,000 common shares of the company on November 4 at a price of $44.7429 per share.
An arbitrator last Friday reaffirmed Fox Corp. (FOXA) has 10 years to exercise its option to acquire a nearly one-fifth stake in FanDuel, settling a longstanding dispute with the betting app’s owner, Flutter Entertainment, Reuters reported. The New York-based Judicial Arbitration and Mediation Services tribunal ruled that Fox would pay $3.7 billion for its right to acquire an 18.6% stake of FanDuel, a sum that could rise to $4 billion when factoring in a 5% annual escalator, the publication added.
In an interview on CNBC’s Mad Money, Jason Robins said he’s "very pleased" with DraftKings’ user growth. The company is doing a good job simultaneously pursuing top line growth and cost efficiencies, he noted. "We’re a young public company and we have a lot to prove," he added.
EARNINGS RECAP: Brag Gaming’s (BRAG) third quarter earnings report came in ahead of last year’s results. The company posted Q3 revenue of EUR 20.9M as compared to EUR 12.9M last year and Q3 EPS (EUR 0.09) vs. (EUR 0.12) last year. The company’s CEO called it a record quarter for the company. "Our record third quarter results reflect significant year-over-year revenue, gross profit and Adjusted EBITDA growth highlighting our progress in providing value-added content and services to a growing global base of customers across regulated iGaming markets, including in North America," said Yaniv Sherman, CEO for Bragg. "In the third quarter of 2022, we generated third quarter records for revenue of EUR 20.9 million (USD $20.9 million), gross profit of EUR 10.4 million (USD $10.4 million), gross profit margin of 50.0%, and Adjusted EBITDA of EUR 2.2 million (USD $2.2 million). Our operating momentum has been consistent throughout the year as for the first nine months of 2022 revenue, gross profit and Adjusted EBITDA have improved significantly, compared to the same period in 2021." Additionally, Brag reiterated its FY22 revenue guidance. "Reflecting its expectation for continued steady operating performance in 4Q22, Bragg reiterated its outlook for 2022 full year expected revenue and Adjusted EBITDA of EUR 76-80M, or U.S. $76-80M, and EUR 10-11M, or U.S. $10-11M, respectively. The midpoints of the 2022 revenue and Adjusted EBITDA guidance ranges represent growth of 34% and 46%, respectively, over the reported full year 2021 revenue and Adjusted EBITDA. Bragg also provided an initial expectation for 2023 full year revenue growth of low double-digit percentage and for 2023 full year Adjusted EBITDA growth of at least 20%."
Genius Sports (GENI) also reiterated its FY22 revenue expectations after surpassing analyst consensus in Q3. "We are pleased to deliver another quarter of growth and Group Adj. EBITDA profitability, and we remain on target to achieve our full-year goals set on our Investor Day at the start of 2022," said Mark Locke, Genius Sports co-founder and CEO. "This year has been characterized by strong execution as we continue to deploy innovative technology, win new customers, and strengthen our key partnerships across the sports, betting, media, and broadcasting ecosystem, all with an eye towards cost discipline and profitable growth… Genius reaffirms its expectation to generate Group Revenue of approximately $340 million and Group Adjusted EBITDA of approximately $15 million in 2022, despite risks related to foreign exchange rates. The Company also expects Group Revenue in the range of $430 to $440 million and Group Adjusted EBITDA of $40 to $50 million in 2023, assuming the guidance exchange rate.
Wynn Resorts (WYNN) posted mixed third quarter results, but noted record adjusted property EBITDA at its combined North America properties. "Our teams at Wynn Las Vegas and Encore Boston Harbor delivered a new third-quarter record for Adjusted Property EBITDA at our combined North American properties. Their relentless focus on five-star hospitality, combined with our market-leading facilities, continue to elevate our properties above our peers as the destinations of choice for luxury guests in both Las Vegas and Massachusetts," said Craig Billings, CEO of Wynn Resorts, Limited. "In Macau, while COVID-related travel restrictions continued to negatively impact our results, we were pleased to experience encouraging pockets of demand during the recent October holiday period. We remain confident that the market will benefit from the return of visitation over time."
On the other hand, Accel Entertainment (ACEL) narrowly missed analyst expectations for EPS and revenue in the third quarter. The company cited inflationary pressures as a headwind during the quarter. We’re pleased with another strong quarter and remain focused on executing our growth strategy. Our solid performance despite the current inflationary pressures further demonstrates the strength and resilience of our locally-focused business model. We expanded our footprint in Nebraska and continue to evaluate multiple opportunities across the country while returning capital to our shareholders." The company did however maintain its revenue and adjusted EBITDA targets for 2022. Macquarie analyst Chad Beynon lowered the firm’s price target on Accel Entertainment to $13 from $14 and keeps an Outperform rating on the shares. The company’s Q3 EBTIDA came in 3% short of consensus but its consumer trends remained strong through October, Beynon told investors in a research note.
THE MATRESS MACK IMPACT: Jim “Mattress Mack” McIngvale won what is believed to be the Keywords: California, Prop 26, Prop 27, legalized sports betting, Mattress Mack, Houston Astros, China, quarantine, earnings, revenue, EPS, inflation, payout, NFL, sportsbooks, Europe
Published first on TheFly
See today’s best-performing stocks on TipRanks >>
Read More on LVS:
