Investing in The Three Largest Gambling Stocks

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The entire gambling industry and online casinos has been rocked by the current situation. While every public company’s stock has been impacted in one way or another, there are three at the top of the list that continues to try and make the most of a bad situation.

 Las Vegas Sands
Trading on the New York Stock Exchange as LVS, this is the largest publicly traded stock in the gambling industry. According to a post on Nasdaq.com, the company’s market capitalization is $34 billion with an enterprise value of $45 billion.

Although this thought of as a Las Vegas-based corporation in the state of Nevada, its US business volume only accounts for 10 percent of its earnings before interest, tax, depreciation and amortization (EBITA). Its two main holdings in that gambling town are the Venetian Las Vegas and the Sands Expo and Convention Center.

The largest share of business comes from the company’s interests in Macau, China. LVS owns five of the biggest casino resorts in that gambling mecca which accounts for 60 percent of its total profits. The ownership group in that region is Sands China Ltd. LVA has a 70 percent stake in that company. The other 30 percent of profits is derived from its Marina Bay Sands property in Singapore.

The current share price is trading around $44 which is 40 percent lower than its all-time high.

 Caesars Entertainment
The new Caesars is a result of a recent merger with Eldorado Resorts. The new company retained the Caesars’ name but it will be managed by the Eldorado team. This stock trades on NASDAQ as CZR.

Caesars is now the largest gaming operator in the US market. The property portfolio consists of 60 casinos across 16 different states. The market cap now stands at $23 billion. The recent acquisition closed with Eldorado paying $17.3 billion for Caesars’ stock. The new company is expected to garner close to $500 million in cost synergies.

One of the biggest strengths of Caesars is its market penetration. It is estimated that more than 55 million gamblers are members of the company’s customer loyalty rewards program. The biggest downside is a massive debt of $15.5 billion. This adds some definite risk for investors in light of the current health crisis.

Much of the future value of the stock will hinge on the company’s financial performance through the rest of this year. If results can outpace projections, then the stock price will have much higher upside potential.

 Flutter Entertainment
Based in Ireland, the stock trades over the counter (OTC) as PDYPY. This bookmaking company is the result of a combination of Paddy Power and the Betfair app. It later acquired the popular fantasy sports and sportsbook FanDuel to expand its presence in the emerging legal US sports betting market.

Flutter has a market capitalization of $22.8 million. Its online gaming operations have been expanded into more than 100 different companies There are 623 retail shops in Ireland and the UK. The most recent acquisition was the Stars Group which represents Poker Stars, SkyBet, BetEasy and FoxBet.

More than 85 percent of the company’s revenue comes from online sports betting, online gaming and online poker. Flutter offers global growth potential in light of the expanding legal online gambling market.

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