VSO Analysis: MGM Tops List of US Gambling Industry Winners of 2021 as Share Price Rises 47%

  • Churchill Downs stock rose 15% throughout 2021 as the firm recovered from the pandemic 
  • Thanks to advancements in sports betting, Caesars’ share price reached $93.53 by Dec 31
  • Boyd Gaming stock grew 39% last year partly as a result of its 5% FanDuel ownership stake
  • Supplier Scientific Games makes the list with cashless gaming driving a 41% share price rise
  • The expansion of BetMGM into 20 states helped MGM stock rise 47% for the full-year 2021
Man on ladder with rising graph
VSO News has assessed share prices of the US gambling industry’s largest companies to create a list of the winners of 2021. [Image: Shutterstock.com]

A year of ups and downs

As we say goodbye to the (still) COVID-19 riddled year that was 2021, it’s time for a brief period of reflection for the US gambling sector.

blossomed with renewed vigor through pent-up demand

The 12 months provided some restoration of normality as casinos opened once more and gamblers returned to racetracks and physical sportsbooks. Some operators and suppliers continued to struggle with the impact of coronavirus, but others blossomed with renewed vigor through pent-up demand, expansion into new markets, and the production of exciting products.

Investor faith can provide some indication of how the US gambling sector’s biggest names handled the opportunities and pitfalls presented last year. Following on from its list of the five losers of 2021, VegasSlotsOnline News has assessed industry share prices to create a list of the sector’s five biggest winners.

5. Churchill Downs Incorporated

Share Price Jan 1: $210.25

Share Price Dec 31: $240.90

Percentage Gain: 15%

Despite not experiencing as steep a decline as some of its fellow US-based gambling operators in the midst of the pandemic, Churchill Downs Incorporated still saw revenue dip 21% year-on-year for 2020. Coinciding with the closure of its properties in March 2020, the operator’s share price fell by as much as 46% in just the first three months of that year.

Q3 net income up 42% year-on-year

Churchill Downs ultimately turned this deficit on its head by the end of 2020, and this progress continued last year with a 15% rise between January 1 and December 31, ultimately reaching $240.90. This places the company fifth on VSO’s list of US gambling industry winners of the year. In part, the increase is due to the company’s rapid recovery in 2021, with Q3 net income up 42% year-on-year.

There are additional reasons for growing investor faith in Churchill Downs, one being its increased focus on the world of sports betting and iGaming, rebranding its BetAmerica Brand to TwinSpires in January 2021. The TwinSpires online sportsbook is now available in eight states after Churchill Downs added Michigan and Tennessee in 2021.

The operator took to Twitter in March to announce the launch of TwinSpires in Tennessee:

Notably, the operator announced in December that it is considering selling its TwinSpires Racing brand, causing its share price to spike 6%. The Louisville-based firm believes a sale could generate as much as $1.5bn. The horse racing offering saw handle rise 31% in the third quarter in comparison to pre-pandemic levels.

4. Caesars Entertainment

Share Price Jan 1: $78.06

Share Price Dec 31: $93.53

Percentage Gain: 20%

Commenting after the announcement of Caesars Entertainment’s Q4 results in 2020, company CEO Tom Reeg expressed hope for the coming year. “With vaccinations underway, we are optimistic about the year ahead,” he said, also forecasting the recovery “of tourism in the US and especially Vegas.” Just as Reeg predicted, both of those factors undoubtedly played a large part in the firm’s improved performance last year.

Caesars is yet to release its full-year report for 2021, but the operator saw a 93% year-on-year revenue increase in the third quarter to $2.7bn. Demonstrating the accuracy of Reeg’s predictions, the company’s fast recovering Las Vegas properties contributed a large portion of that total at $1.01bn.

completed its $4bn acquisition of William Hill in April

Adding to this recovery, Caesars has continued its advancement into the increasingly profitable world of sports betting. The company completed its $4bn acquisition of William Hill in April, allowing it to rebrand the renowned betting offering as Ceasars Sportsbook. The wagering app is now available in 11 states plus Washington DC.

These factors have evidently contributed to increased investor confidence in the US gambling giant. From January 1 2021 to December 31 2021, Caesars’ share price rose by 20% to $93.53 on the Nasdaq, placing the business fourth on VSO’s list of winners.

3. Boyd Gaming

Share Price Jan 1: $47.03

Share Price Dec 31: $65.57

Percentage Gain: 39%

Like the rest of the US gambling industry, casino operator Boyd Gaming struggled in 2020 with the closure of its properties. The company saw a resurgence in 2021 however – something  Forbes has attributed to its diversified US presence. Boyd now owns and operates 28 gaming properties in ten states, including Nevada, Ohio, and Pennsylvania among others.

In a bid to keep its casinos open and help in the recovery of Vegas, Boyd also stepped up its own vaccination efforts in 2021. The company joined others in Nevada’s gambling industry by kickstarting a vaccination campaign in April, offering workers and their families free inoculations and reimbursing employees with paid leave.

The operator’s 5% ownership stake in FanDuel has also played a part in the firm’s share price rise since 2020, with the sports betting giant growing significantly in that time. FanDuel shares are not yet publicly traded, but Boyd stock has risen 107% since February 2020. For the full-year 2021, Boyd saw its share price jump by 39% to a total of $65.57.

2. Scientific Games

Share Price Jan 1: $47.25

Share Price Dec 31: $66.83

Percentage Gain: 41%

US gaming suppliers experienced a middling 2021, evident in the fact Scientific Games is the only provider to appear in VSO’s winners or losers lists. That said, the operator has made it to second thanks to a sharp 41% rise in its share price, from $47.25 at the beginning of the year to $66.83 on December 31.

In fact, Scientific Games has had a very successful couple of years despite the impact of the pandemic on global gaming. While other providers may have felt the impact of the pandemic on sales numbers, SG has entered new markets and formed countless deals with operators across the US.

The company has also expanded its reach outside of the nation, taking to Twitter in September to confirm its new ten-year deal with the Azerbaijan lottery:

This year, the firm has even utilized elements of the pandemic to its gain, namely the increased reliance on cashless technology for casino gambling. In March, SG signed a cross-licensing deal with IGT allowing the two supplier giants to combine cashless technology. IGT’s CEO Renato Ascoli described the combined offering as the “most compelling portfolio” of cashless products on the market.

Other notable mentions in SG’s year include the company’s plans to divest its lottery and sports betting business. The supplier announced the strategic decision in June, asserting that it would allow for “enhanced growth.”  In September, the firm also freed up $1.2bn in capital for digital and content investment via the sale of OpenBet.

1. MGM Resorts International

Share Price Jan 1: $30.60

Share Price Dec 31: $44.88

Percentage Gain: 47%

The pandemic saw MGM Resorts International’s revenue dwindle in 2020, with net revenue down a staggering 60% year-on-year to $5.2bn. Net loss also shot up to $1bn in comparison to net income of $2bn the prior year. The operator’s share price took a hit as a result, tanking 62% in March before eventually recovering to $28.56, a much less eye-watering 8% drop from January 2020. 

This year has proven a different story entirely for the Las Vegas-based gambling giant. MGM had topped VSO’s list of winners thanks to a sharp 47% increase in its share price to $44.88 on December 31.

met its target of launching BetMGM in 20 states

Commenting after reporting the company’s losses in 2020, MGM CEO Bill Hornbuckle said the company aimed to turn the tide by continuing to drive its US sports betting and iGaming venture BetMGM – a strategy that has paid dividends this year. The company met its target of launching BetMGM in 20 states by the end of 2021, and has plans to add New York and Illinois to that list very soon.

This betting expansion and the return of casino gambling in the US has led MGM’s revenue to increase dramatically from 2020. The company reported Q3 revenue of $2.71bn, a 146% increase from the prior year.

Added to this, the business is freeing up additional capital through various means. In Q3, MGM reached an agreement to sell spun-off Real Estate Investment Trust MGM Growth Properties for $17.2bn. The company also plans to sell the operations of the Mirage in Las Vegas.

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