Digital Gaming and Fantasy Sports Are Huge Winners: 3 Top Stocks to Buy Now

There was a time in the not too distant past when the major professional sports leagues avoided gambling like the plague. Those days gone with the wind. , teams and leagues are embracing the top gaming companies with open arms, as more and more states legalize online gambling and fantasy sports betting. In 2018 the U.S. Supreme Court ruled in the favor of individual states on a case involving the constitutionality defined by a 1992 law, the Professional and Amateur Sports Protection Act, which prohibited states other than Nevada and Delaware from operating sports betting.

That ruling caused a tsunami of change, and many states have since legalized gambling for not only casino-operated gaming but for online digital gambling and betting on fantasy sports. A new Jefferies research report includes a deep-dive into what the firm calls the digital gaming matrix. The analyst noted this:

Digital Gaming continues to present itself as the most critical development across Gaming, especially as the formative sports betting market continues to expand across the nation. Overall, we expect the sports betting market to reach ~$19 billion by 2025, predicated on the four “super states”: Florida, Texas, California and New York (likely closest) legalizing mobile wagering. While the intangible, on-the-come nature of the business makes assigning values theoretical, we believe the amalgamation of online and social engagement measures should serve as a proxy for operating performance over time. We note that our review of the data suggests more of the engagement is oriented toward sports betting versus iGaming, which has important implications for interpreting brand scores.

Three top stocks that trade on U.S. exchanges are cited as among the firm’s favorites, and they are Buy rated at Jefferies. All make sense for aggressive growth investors looking to invest in this massive and fast-growing arena, but it is important to remember that no single analyst report should be used as a sole basis for any buying or selling decision.

Caesars Entertainment

Shares of this well-known old-school gaming company offer solid upside. Caesars Entertainment Corp. (NASDAQ: CZR) provides casino-entertainment and hospitality services, primarily under the Harrah’s, Caesars, Horseshoe and Eldorado brand names.

Its facilities include gaming offerings, food and beverage outlets, hotel and convention space, and non-gaming entertainment options. Caesars Entertainment is one of the largest gaming companies in the world and currently owns or operates 50 casino properties in 13 states and in four other countries.

Also the largest casino company in the United States, Caesars Entertainment, recently bought a minority stake in fantasy sports platform, SuperDraft. Caesars has the option to increase its stake to 100% over time at predetermined levels. SuperDraft will join the Caesars online brands, which include World Series of Poker, Caesars Online Casino and William Hill, and it will become part of Caesars’ single wallet solution that allows members more options to play games both live and online.

Jefferies has an $85 price target for the stock, while the Wall Street consensus target is up at $89.15. Caesars Entertainment stock closed Tuesday’s trading at $81.57 a share.

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