Investing in Casino Stocks


Gambling has a long history in North America, dating to the early 17th century. The first games of chance on the continent came with the original settlers, who also brought their passion for horse racing and lotteries. The latter was the dominant gambling form in the colonies and throughout the centuries to come, as other betting activities faced stricter legal restrictions. In 1929, the stock market crashed. That occurrence, along with the Hoover Dam project, led to gambling legalization in Nevada.

In 1976, New Jersey decided to allow casinos to promote urban redevelopment in Atlantic City, and twelve years later, the Indian Gaming Regulatory Act got passed, birthing tribal establishments. From then on, slowly, US states have become more lenient in permitting commercial casinos and different forms of online wagering. Today, there are over 460 gaming establishments on US soil, not including tribal ones. The country’s land-based casino industry pulls in annual revenues of close to $30 billion, with a few established juggernauts controlling massive portions of this market.

Why Gambling May Soon Boom in the US

Despite popular belief, gambling is not widely allowed in the US. Louisiana and Nevada remain the only two states in the nation where casino gaming is legal statewide. Other territories may permit it limited to specific geographic areas, usually smaller ones, to incite economic growth. However, in 2018, the Supreme Court decided to repeal the Professional and Amateur Sports Protection Act, letting states pass their sports betting regulation. Due to that decision, over twenty US states have passed such laws, and many more are preparing bills to do the same.

The pandemic-induced restrictions caused brick-and-mortar venues to shut down for a significant part of 2020, with them coming back allowed to operate at only half-capacity. That drastically affected operator’s bottom lines, who turned to explore options in the digital sphere. Because the US economy, as a whole, got hit by the pandemic, many states are looking to plug budget shortfalls by permitting online casino games for their residents, hoping that they lead to new tax streams. As the global crisis subsides, land-based operators expect revenues to shoot up as they begin running their operations as they did before the pandemic.

How to Invest in Casino Stocks

Most savvy investors with experience in this sphere would advise people to stay away from stocks from less established or lower-rank casino operators. These are very high-risk. Once an industry calamity happens, many such entities cannot take the associated financial hit. Fresh ones spend a ton of money on generous affiliate commissions and advertising when they start, which means that they estimate that they will operate for many years in the red before recouping their initial investment and beginning to turn a profit.

Thus, it is best to stick to big brands that have the potential to expand, ones that can bounce back from massive setbacks. Also, those that bring novelty into this sector are worth a look. However, that mainly refers to product developers/suppliers, not companies that host games of chance.

It is essential for investors to understand that the end customer drives demand, the importance of regional dynamics, and how innovations can impact prices.

The Principle Downsides of Casino Investing

Gaming regulators hold tremendous sway over the gambling industry. First off, US organizations such as the New Jersey Division of Gaming Enforcement and Nevada’s Gaming Control Board implement much higher regulatory standards than similar bodies in other countries. One restrictive decision from a state’s regulator can send shockwaves throughout its gaming market. Thus, operators’ revenues and their stock prices are at the mercy of these bodies.

Moreover, the interactive or online casino sector is booming, projected to generate $158 billion by 2028. Most land-based operators are not active in the sphere, and it is not easy for them to snag sections of this market from established iGaming brands, which will only continue to grow. Inflation also causes venues to raise their table limits, making them less appealing to casual gamblers, which make up a significant portion of their player base.

Best Gaming Entities to Back Right Now

Per historical patterns, the real-world gambling market heats during warmer periods, opposite internet betting platforms where activity peaks from November to January. So, when looking at a stock, it is vital to remember that the period of the year will drastically affect its current price.

Right now, the four best US-based gaming entities to invest in are Wynn Resorts, Las Vegas Sands, MGM Resorts International, and Caesars Entertainment. All of these have been making substantial moves lately. Caesars bought out UK sportsbook William Hill, Las Vegas Sands sold off properties worth $6.25 billion, MGM is desperately looking to acquire Entain Plc, and Wynn Resorts merged with the Austerlitz Acquisition Corporation.

About the Author

Shelly Schiff has been working in the gambling industry since 2009, mainly on the digital side of things, employed by However, over her eleven-year career, Shelly has provided content for many other top interactive gaming websites. She knows all there is to know about slots and has in-depth knowledge of the most popular table games. Her golden retriever Garry occupies most of her leisure time. Though, when she can, she loves reading Jim Thompson-like crime novels.


About Author

Founded in 1994 by the late Pamela Hulse Andrews, Cascade Business News (CBN) became Central Oregon’s premier business publication. •

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