3 Sports Betting Stocks to Buy and Hold for the Next Decade

  • These three sports betting stocks to buy could be poised for strong long-term growth. 
  • DraftKings (DKNG): Revenue recently surged to $1.18 billion, surpassing estimates by a rather wide margin. 
  • Caesars Palace (CZR): Analysts predict the company’s earnings per share will quadruple by 2031. 
  • MGM Resorts (MGM): The company also beat on solid Q1 earnings and could continue to see robust growth. 
sports betting stocks to buy - 3 Sports Betting Stocks to Buy and Hold for the Next Decade

Source: NYCStock / Shutterstock.com

It might feel like yesterday, but it’s already been six years since the U.S. Supreme Court lifted the federal ban on sports betting. This has allowed states to legalize the sport, and now, over 30  states and D.C. have offered different online options. It has also been reported that 10 other states will come through the legalization soon. Of course, this has been very good news for investors in sports betting stocks.

Although sports betting is nothing new, the sector has definitely grown since its ban was lifted in 2018. Last year, the U.S. sports betting market reached $121 billion, 30% up from 2022’s numbers. Most states have legalized sports betting, and it shows a potential growth area for investors in the coming years.

With the market expanding rapidly, betting is gaining popularity in already-legal states. Here are three top investment options to consider in this burgeoning industry.

DraftKings (DKNG)

Person holding smartphone with logo of US sports betting company DraftKings Inc. (DKNG) on screen in front of website. Focus on phone display. Unmodified photo.
Source: T. Schneider / Shutterstock.com

DraftKings (NASDAQ:DKNG) recently announced its excellent Q1 2024 earnings report, Making it one of our top sports betting stocks to buy. With an unexpected EPS of $0.03, the company was also proud of its revenue, which hit $1.1 billion and exceeded estimates of $60 million.

DraftKings, a digital sports and gaming powerhouse, excelled in Q1 2024, focusing on user engagement and cost efficiency. Expanding into Vermont and North Carolina responds to growing online betting trends. DraftKings’ innovation led to a 23% increase in Monthly Unique Payers and a 25% rise in Average Revenue per MUP, ensuring sustainable growth.

In Q1 2024, DraftKings expanded into two states, with a notable 53% revenue increase, attracting 3.4 million users. DraftKings demonstrated operational efficiency by surpassing EPS estimates and boosted ARPMUP to $114, enhancing customer value. These show how DraftKings is excellent in thriving in a competitive market.

Caesar’s Entertainment (CZR)

Caesar's Palace (CZR) in Las Vegas
Source: Jason Patrick Ross/Shutterstock.com

Caesars Entertainment (NASDAQ:CZR) is probably one of the biggest names in sports betting and casinos. The company operates in 18 states and offers sports betting in 31 jurisdictions. While CZR faces risks, it’s potentially attractive to speculators. Despite the post-quarantine era, consumers still prioritize experiences, potentially boosting CZR stock. 

Analysts forecast a challenging EPS of 37 cents this year but with a high-side estimate of $3.10. Last year’s revenue was $11.53 billion, with 2025 estimates ranging from $12.09 to $12.59 billion. CZR could be a buy for those banking on a post-pandemic travel surge. Currently undervalued, CZR’s future targets show promise.

In other news, the company partnered with the Fiesta Bowl Organization for the first-ever sports betting collaboration in college football bowl games. CZR will set up new fan lounges, sponsor pregame parties and support responsible gaming. The partnership is set to enhance the fan experience and promote responsible gambling.

MGM Resorts International (MGM)

A photo of the MGM logo on the MGM casino building.
Source: Michael Neil Thomas / Shutterstock.com

Although there has been a strong stigma in gambling, it is evident that the popularity of it in the U.S. is strong. This is also due to disposable income and legalization. Well-positioned to the benefit, MGM Resorts (NYSE:MGM) has a strong buy rating and significant undervaluation from analysts.

In March, the MGM Collection with Marriott Bonvoy, a collaboration between MGM Resorts International and Marriott International, offers unique experiences. Now bookable on Marriott.com and the Marriott Bonvoy app, it provides access to 16 iconic destinations — Marriott Bonvoy Moments® feature exclusive experiences like Bellagio fountain shows and Cirque du Soleil performances. 

Peggy Roe, Marriott’s Executive Vice President, emphasizes creating unforgettable experiences. This collaboration promises epic moments and impeccable service at renowned Las Vegas and U.S. resorts.

On the date of publication, Chris MacDonald did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Chris MacDonald’s love for investing led him to pursue an MBA in Finance and take on a number of management roles in corporate finance and venture capital over the past 15 years. His experience as a financial analyst in the past, coupled with his fervor for finding undervalued growth opportunities, contribute to his conservative, long-term investing perspective.

Article printed from InvestorPlace Media, https://investorplace.com/2024/05/3-sports-betting-stocks-to-buy-and-hold-for-the-next-decade/.

©2024 InvestorPlace Media, LLC