American Football

This Gambling Stock Is Poised for a Bull Run — and It’s Not DraftKings – The Motley Fool

Since the return of live sports, gambling revenues have been historically strong. Events such as the National Football League draft enjoyed record gambling marks. This points to pent-up demand and bodes well for companies trying to carve success in the field.

With legalization decisions delegated to states, 22 have approved legislation to allow the activity since 2018. COVID-19 destroyed tax revenue streams which could incentivize more states to follow suit. Regardless, sports gambling is set to enjoy long-term growth. DraftKings is a popular pick within the space, but Penn National Gaming (NASDAQ:PENN) is best positioned to thrive.

5, $100 bills, a football and 2 betting receipts

Image source: Getty Images.

Penn’s path forward

Penn National Gaming is a regional casino company operating in 19 states. COVID-19 has certainly been tough for the entire industry, but Penn’s credit and equity market activity has boosted its cash position to $1.4 billion. This is vital to continue investing aggressively in sports gambling.

While Penn does have physical sports books at its casinos, its main initiative is establishing a dominant presence in digital sports gambling. How?

Earlier this year, CEO Jay Snowden announced a 36% stake in Barstool Sports, with warrants to acquire another 14%. Together, the two companies plan to release a digital sports betting app this year called Barstool Sports Book. Online gambling alone is set to grow to $103 billion by 2025, powered by an 11.5% annual growth rate. Furthermore, there is a black-market