Is This The Right Time To Invest In Online Gambling?

By Tyler Pack

2020 was probably the most bizarre year for the casino industry compared to most of the market, with some stocks skyrocketing and others tanking. Gambling establishments such as Wynn Resorts, Las Vegas Sands, and Melco Resorts lost value and underperformed the market last year.

On the other hand, online gambling stocks like DraftKings and Penn National Gaming went uphill to more or less three times their value last year because capitalists bet they'd be the highest growth stocks in the industry. Unfortunately, expectations for online gambling stocks might have gotten too high.

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Experts predict that online gambling stocks may gradually go downhill in 2021 as physical casinos are opening again. So, is it still okay to invest in online gambling when stocks are down?

Say Yes To Investing

When stocks are down, should you invest? The answer is YES. Remember, investing is all about achieving your financial goals. As such, it's critical to keep your eyes on the stocks in any market conditions.

Here's an analogy: if a pair of shoes is on sale, you would indeed purchase them while enjoying the savings, right? On that note, stocks must be no different. Buying while stock prices are down can be a savvy move. In the end, "sell high, buy low" is the mantra for seasoned investors.

Your investing decisions must be based on your financial needs. It shouldn't be based on market movements. Rushing to sell while stock prices are down is just as emotional as buying when they are down.

Top Online Gambling Stocks You Should Look At

When the pandemic forced land-based gambling establishments worldwide to close and suspend, online gambling companies have significantly helped many people who'd typically go to the physical casino to gamble. This year, even as casinos start to open again, many people would still choose to gamble online.

The following are the top online gambling stocks to keep an eye out for.

DKNG (DraftKings)

DraftKings, Inc. is an online entertainment and sports gaming company that offers its users online casino gaming opportunities, daily fantasy sports, and sports betting. According to IBD data, DraftKings is on the journey to profitability.

After losing a share of $3.26 in 2019, the company lost $2.76 in 2020. Experts predict the company to lose $1.42 this year and a percentage of $1.00 in 2022. DKNG stock is a positive long-term possibility in the sports betting industry.

The potential of the company is very encouraging to investors. Despite the company's lack of earnings, DraftKings has massive revenue growth and is the frontrunner in the online betting trend. DraftKings has also expanded in casino gaming, providing diversification.

GNOG (Golden Nugget Online Gaming)

Golden Nugget Online Gaming, Inc. is a digital sports entertainment and online gaming company. It provides its users with live-action sports events in Michigan and New Jersey and different casino games.

After declaring 4Q 2020 financial results on May 19, shares of GNOG declined as much as 12.6%. In the fourth quarter, the company stated a 48% rise in revenue to $23 million. What's more, Golden Nugget Online Gaming reported $6.2 million in adjusted profits before amortization, depreciation, taxes, and interest.

In the quarter, the net loss was $42.8 million, which is expected with the expensive cost of the SPAC merger. Golden Nugget Online Gaming is perhaps one of the smaller companies today. As such, it needs to get bigger and develop quickly to get a fair market share.

So, if you are willing to hold onto GNOG as a long-term investment and endure the volatility, Golden Nugget Online Gaming is still a company with great potential.

NGMS (NeoGames)

NGMS stock is surging after the online lottery operator delivered 2021 guidance and 4Q that exceeded consensus estimates as a public company in its first earnings. The company declared its adjusted profits before amortization, depreciation, taxes, and interests of $9 million on gains.

Although online lottery does not create the hype that sports wagering and iGaming do, NeoGames' primary business features the same factors. It includes expanding state-level legalization.

ALSO READ: Increased Online Gambling Concerns Legislators, Excites Players

Final Thoughts

Regardless of which online gambling asset you decide to invest in, it is indeed quite a wager on whether or not the stock will continue to shoot up in the long run. With the casino industry's massive growth in the past year alone, it is clear that the industry has great potential, even though land-based casinos are starting to loosen their reins and allow people to play games physically.

Investing in the online gambling industry is undoubtedly a smart move this year as long as you don't spend all your money playing casino games. Be sure to choose safe and secure online casinos to invest in.

(Disclaimer: The article is sponsored and hence promotes some commercial links.)