The newly approved Amendment will allow casinos to offer previously banned games such as baccarat, keno and the big six wheel
All eyes from the gaming community were on Maryland, Louisiana and South Dakota, due to the voters' approval of sports betting in those states on Tuesday's election. However, the outstanding approval of the gaming expansion in Colorado referendum is expected to be worth millions in revenue to casino operators in Black Hawk, Central City and Cripple Creek.
Referendum to Amendment 77 sees the single bet wagering cap previously imposed removed which, will ultimately, allow casinos to offer various previously forbidden games, such as baccarat, keno, and the big six wheels.
David Bain, a gaming analyst for Roth Capital Partners outlined during a statement that, “We believe the increase in wagers will appeal to higher net worth clients, potentially fueling more trips/overnight stays.” Additionally, Bain adds that since casinos in Colorado were only recently permitted to add sports betting back in May, and along with the inclusion of new games to the traditional table game offerings, there is potential that casinos could double in revenues in some properties.
“An augmentation to baccarat and/or Pai Gow titles could also expand the demographic, particularly the Asian patron, in our view,” Bain said.
Barry Jonas, a Truist Securities gaming analyst mentioned that the cap on wagering limits had “hindered the marketplace.”
Tuesdays gaming expansion vote saw people, in six states, vote in favour of the expansion agreement which was much to the delight of both the investment community and gaming industry insiders.
With this, it is now known that, due to the sports betting winning voter approval in Maryland, Louisiana, and South Dakota, 50% of U.S. states are now authorized to manage and regulate such activity. It is suggested that the remaining 25 states including Washington D.C. could offer sports betting by the end of next year.
Mr David Schwartz (pictured - left), a gambling historian representing the University of Nevada Las Vegas mentioned during an interview with the Associated Press that, “It appears that Americans are becoming increasingly comfortable with legalized gambling,” whilst also adding that “We have reached a point where voters seem satisfied that legalizing gambling will offer positive returns for their state.”
The perspective from D.C. and Wall Street
American Gaming Association CEO Bill Miller stated that 44 out of the 52 American states have some sort of legal gaming, with 45% of U.S adults, amounting up to approximately 15 million people, reside in states where legal sports betting is permitted.
“As a result of successful ballot measures in six gaming states, more Americans will have access to much-needed job opportunities, dedicated tax revenue, and safe, regulated entertainment options closer to home,” Miller (pictured right) said.
Both casinos and sports betting operators were rewarded by investors with a boost in their stock values on Wednesday. Due to this boost, the industry insiders have praised the instant success and are quickly considering that gaming has become a main street industry in the U.S.
DraftKings were one of the winners regarding their stock value as it increased by 5.31% due to financial backing of the Maryland referendum. Bar stool Sports, in partnership with Penn National, also saw an increase of 6.55% in stock price on Wednesday. Hollywood Casino Perryville in Maryland will see their operations purchased by Penn so that they will be able to take advantage of the new sports betting opportunities.
Golden Entertainment shares, which also owns Rocky Gap Casino in western Maryland, and Caesars Entertainment, which operates Horseshoe Casino Baltimore, also opted in on the sports betting opportunity. Golden and Caesars' shares rose 8.68% and 4.17% on the Nasdaq respectively. Furthermore, investors were also keen to support Caesars since, it will now operate one of the four casinos approved by voters in Virginia.
Casinos in Deadwood, South Dakota, the states sole gaming market, will have to wait for the state’s legislature to approve sports betting regulations.
Morgan Stanley gaming analyst Thomas Allen said the three states could open up a $537 million sports betting market.
A developing interest
Through it's approved legislation, Virginia has increased its number of casinos and the state of Nebraska allows casinos to operate at state-licensed horse racing tracks in Omaha, Lincoln, Grand Island, Columbus, and South Sioux City. Miller outlined that gaming will continue to draw substantial interest of both federal and state representatives.
Miller continued to add that the AGA will continue to liaise with leaders of congress “to shape a favorable policy environment for gaming.” He further stressed the importance of a “positive economic impact” the casino industry has on local communities.
“We also look forward to continuing to work with members on both sides of the aisle to address overly burdensome and unnecessary regulations and taxes, as well as reducing illegal gambling operations that continue to pose a risk to the American public and the economic success of our industry,” Miller said.
Miller continued to say that immediate action is needed to address the current national economic crisis created by the Coronavirus pandemic.
“To effectively recover, our industry needs critical relief that aids employee retention and rehiring, provides liability protections for responsible operators, supports tribal nations, and jumpstarts the travel and tourism industry,” Miller said. “And we’ll continue to work with leaders in this Congress and the Trump administration to advance these immediate priorities.”
Source: CDC Gaming Reports
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