Betting is one of the best places you can put your investment money right now. The industry is growing at a staggering rate, and the biggest companies are continuing to grow and drive even more impressive profits. But this isn’t the whole picture and doesn’t give you everything you need to know for investing in them.
Today, we’re going to look at both sides of how well betting company stocks perform, and whether or not you should place your trust in them and if so, how.
Let’s get started.
How they perform well
Let’s first look at the areas in which betting company stocks perform well. Some of the best-performing companies, such as Light & Wonder Inc, MGM Resorts International, and the Boyd Gaming Group show plainly enormous profits in a short period of time. This reflects in the performance of their stocks. Their market caps range from $4-13 billion USD. MGM and Light & Wonder boast staggering EPS growth rates of around 2,900%.
Even Bally’s Corp, which saw a negative EPS growth of -30%, still saw revenue growth of 106%. Some of the best-performing betting stock overall has been companies such as Churchill Downs and the International Game Technology PLC. With the right investment at the right time, you would have seen enormous gains from even small investments in these companies.
With the global betting industry expected to grow by around 10% in the decade 2020-2030, it’s plain that the strongest betting company stock is going to perform incredibly well. Those who trade publicly almost always do far, far better than their non-public counterparts, too.
So, clearly, betting company stocks perform very well when the companies are competently run. However, this isn’t the only side of the story so let’s look at some reasons betting company stock does not perform as well sometimes.
One of the big potential issues with the gambling industry is local regulation. Gambling is usually more heavily regulated than any other industry, and the regulations are constantly being updated. Any one of these governmental decisions can have a massive impact on the value and performance of a company’s stock. While these regulations are naturally restricted to a certain area, they can still have a global impact.
Investing in global operations is usually your best choice for this reason. This gives you the most protection from any one area increasing or tightening its regulations. In any case, though, this is always a risk for the gambling industry and for betting in gambling stocks.
The other problem is the rampant competition. Most would agree that innovation has been one of the biggest factors driving growth in the industry over the last couple of decades. Even the most well-established operator can have the rug swiped from underneath them by one of the many new bookmakers entering the market.
With this level of competition, it can be hard to predict who is the best company to invest in. A simple solution to this is a diversified portfolio within the betting industry, making sure to invest both with established but also with up-and-coming operators.
So, plainly, the right companies do perform incredibly well on the stock market. That said, growth year-on-year isn’t always guaranteed. The essence of investing in stock markets should always be that you are looking to the long term, to see a small investment grow over time. With the money put in the right place, you can be sure that your stocks in the betting market will perform well. And don’t forget that gambling is always under the pressure of competition and regulation in terms of the stock market.