As Americans settle down this Sunday to watch the Kansas City Chiefs take on the Philadelphia Eagles at Super Bowl LIX, sports betting stocks like DraftKings (DKNG) and Flutter Entertainment (FLUT) could be set for a bumper payday.
Maximize Your Portfolio with Data Driven Insights:
- Leverage the power of TipRanks' Smart Score, a data-driven tool to help you uncover top performing stocks and make informed investment decisions.
- Monitor your stock picks and compare them to top Wall Street Analysts' recommendations with Your Smart Portfolio
The American Gaming Association (AGA) estimates that sports fans will wager a record $1.39 billion legally on Super Bowl LIX, highlighting what it says is the continued expansion and enthusiasm around the legal sports betting market.
“No single event unites sports fans like the Super Bowl, and that excitement extends to sports betting, with this year’s record legal handle reflecting its widespread appeal,” said Bill Miller, AGA President and CEO.
The Super Bowl is the most bet-on event in the U.S. each year, with increasing amounts being wagered via legal sports betting platforms following the Supreme Court’s 2018 ruling to strike down a ban on sports betting.
True Bets Figure Will Be Much Higher
The $1.39 billion estimated by AGA is only the tip of the iceberg. Accounting for all bets, including illegal wagers made via offshore sportsbooks or bets placed with local bookies, the total is expected to be far higher.
When allowing for all types of bets, last year’s Super Bowl saw $23.1 billion in total betting activity, says the AGA.
But more betting activity is not a guaranteed win for the bookmakers. While DraftKings made $8.8 million from $52.3 million in bets it accepted on last year’s Super Bowl, BetMGM (MGM) lost $4.8 million after taking in $10.8 million in bets.
“It was a bad Super Bowl for the sportsbook,” Tristan Davis, senior trader at BetMGM, told MarketWatch.
DKNG, on the other hand, will hope for more of the same this Sunday with Super Bowl LIX.
Is DKNG a Good Stock to Buy?
Overall, Wall Street has a Strong Buy consensus rating on DKNG, based on 27 Buys and two Holds. The average DKNG price target of $51.97 implies about 22% upside from current levels.
