It's still unclear what dominos are next to fall as legalized sports gambling ramps up, but according to an analysis from a University of Louisville economist, investors believe there will be a positive and significant impact on companies that operate casinos, racinos and sports books.
In his report, Dr, Steven Vickner, an assistant professor in the University of Louisville Equine Industry Program, looked at gains and losses for firms in the casino and gaming industry on May 14 and in the days that followed. May 14 was the day the Supreme Court stuck down the 1992 Professional and Amateur Sports Protection Act (PASPA), opening the door to legalized sports betting nationwide.
The companies that saw the biggest increases in stock price were Paddy Power Betfair, owner of TVG and FanDuel (+22 percent after 10 days); William Hill, operator of the sports book at New Jersey's Monmouth Park (+13 percent after 10 days); and gaming corporation Scientific Games (+10 percent).
“The message in the stock market was quite clear on May 14th and the subsequent 10 days of trading – returns to gaming and casino shares increased sharply and those increases were statistically significant,” wrote Vickner.
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