The US gambling sector has exploded over the last couple of years, with recent law changes bringing many of the world’s biggest gaming and entertainment companies to our shores. It’s a good time to invest, but where should your money go? What are the best casino and gaming stocks to sink your money into this year?
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MGM Resorts (NYSE: MGM)
MGM Resorts took a dive during early 2020, as was to be expected, but like many other casino and entertainment stocks, it recovered and has been going strong ever since. It has a strong presence in many gambling markets, including its massive venues in Las Vegas and Macao. If it was wholly invested in land-based gaming, we’d be a little concerned, but it has heavily invested in online gambling, and this is where it’s seeing some of its most exciting growth.
BetMGM is a great example. It’s a hugely popular sportsbook and is one of the best casinos with fast hassle-free payouts, bringing it to the attention of gamers and bettors everywhere. In addition to its presence in the US market, BetMGM has also recently launched to big fanfare in international markets like the United Kingdom, with Chris Rock serving as the brand’s ambassador.
LeoVegas is also an MGM-owned brand, and one that has an established presence across many lucrative markets in Europe and Asia. MGM Resorts has assets in the tens of billions of dollars and in 2013 its revenue topped $16 billion. It’s a solid performer and a great stock to add to your casino portfolio.
DraftKings (NASDAQ: DKNG)
DraftKings is fairly new to the scene, especially when compared to the gaming giants that have been around for decades. It launched in 2012 and went public 8 years later. It owns a sizeable share of the daily fantasy sports market, but the real promise comes from its presence in the sports betting and casino gaming sectors, helped in no small part by its many acquisitions.
It acquired Golden Nugget Online Gaming for $1.5 billion a year after going public and purchased Jackpocket as recently as March 2024, showing that it’s still intent on growing and becoming more of a force in this lucrative sector.
DraftKings is one of several major companies to have been given licenses to offer online sports betting and casino gaming services throughout many states, and it’s here where we predict the biggest growth. It’s not yet the highly profitable company we expect it to be, but it can surely only improve from here.
Caesars Entertainment (NASDAQ: CZR)
Eldorado Resorts acquired Caesars Entertainment in 2020 and kept the name. It’s one of the biggest and most instantly recognizable names in casino entertainment and has a number of incredibly valuable assets that put it in a good position to dominate the blossoming US online gambling sector.
A few years ago, it acquired William Hill, a long-running British betting brand that is a household name across the pond. It later sold the brand’s European assets for $3 billion ($700 million short of what it had paid for the company) and rebranded all of its American assets into Caesars Sportsbook.
It also owns the World Series of Poker brand, the biggest live poker tournament in the world and one of the game’s most valuable names.
Caesars has delivered incredible returns since it first went public back in 2014. As with MGM Resorts, the bulk of its investments are in land-based gaming, but the rise of Caesars Sportsbook and other ventures is where its future promise lies.
PENN Entertainment (NASDAQ: PENN)
PENN Entertainment is very well placed to benefit from the online gambling boom. It soared during 2020, and while it has since lost most of those gains, it should still experience steady growth. It owns about a third of Barstool Sports, including Barstool Sportsbook, and it also acquired theScore for $2.1 billion.
theScore is a Canadian company that offers a number of sports betting and gaming products and has significant influence in the online gambling sector. It means that PENN Entertainment can spread further into The Great White North while also improving its offering throughout the United States.
In total, PENN has assets valued at more than $17 billion, although its net income is less than $250 million. It’s definitely one to watch if you’re looking for a company that can profit from online casino gaming and sports betting.
Summary: Investing in Casino Stocks
Much like placing a bet on a sporting contest or stacking some chips on the roulette table, there is a high element of risk when investing in casino stocks. But the same could be said for any other stock, especially those reliant on the entertainment sector and subject to influence from lawmakers.
So, consider your investment closely and remember that there is no guarantee it will grow. Your capital is always at risk. Read our guide on keeping your stock portfolio safe to learn more.
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