As battered-down meme stocks fall out of favour a year after the craze began, some gaming industry analysts predict a flood of new wagers on online sports betting apps.
According to data crunched for On the Money by data firm Thinknum, mentions of GameStop on the Reddit board WallStreetBets have fallen slightly, by 1.45 percent, over the past year. Meanwhile, mentions of Caesars Entertainment have increased by nearly 1,000%. DraftKings, a sports betting app, is up nearly 560 percent.
Yes, most likely because FanDuel and DraftKings, which control the majority of the online sports-betting market, have recently dangled $1,000 credits to entice new members. Despite a 51 percent state tax on online gaming revenues, Caesars has also staged aggressive promotions in New York.
Nonetheless, Chris Grove, a gaming analyst and the CEO of a lead-generation company focused on the US gambling market, believes these apps have good reason to be optimistic about their promotions.
“Betting on stocks is the same as [gambling] in an app,” Grove told On The Money. “There’s a common thread running through these activities — and a fair amount of demographic and skill set overlap between meme stocks and sports betting.”
As meme stocks dwindle, sports betting apps have seen a significant increase in mentions.
The New York Gaming Commission reported last week that mobile sports betting was off to a brisk start in its first week, with Caesar’s, FanDuel, DraftKings, and BetRivers taking more than $600 million in bets. According to gaming analysts, the massive haul was partly due to “heavy promotion from the operators.”
“Unlike Uber or Doordash, there is no doubt that this will work once the initial phase of jockeying for market share subsides,” Grove claims. “The core business is profitable.”
Nonetheless, one gaming operator wants to cash out early. The Post was the first to report that Las Vegas-based casino giant Wynn is quietly selling its Wynn Interactive unit — operator of the WynnBet online gaming app — for $500 million after floating a $3 billion valuation less than a year ago.