According to figures coming from the Casino Sites Licensing Gambling Commission, there is a continuous rise in the value of gambling in the UK, as the sector that was valued at £13.8 billion as at September 2016 has grown rapidly.
This may seem very beautiful and profitable to many people. However, we have to ask whether it wise to buy casino stocks? There has been a sort of decline in the rate of investments in gambling stocks in the past years. Many people attribute this decline to the change in the age of people currently engaging in gambling, and what most millennials are interested in. Some other people may attribute this to some level of social responsibility. These are people that are concerned more about ethics, and may not want to invest in casino stocks, as some of them may see it as a sin.
However, information from Matt High, who is a content editor in Casinopedia.org that’s at the forefront of casino publishing reveals that there is currently a very huge appetite for investments in casinos and their affiliate firms like never before. This obtains at least in the UK, where the market has witnessed an increasing growth, both in the number of developers of online casinos and in the number of land based casinos that spring up every other day. There is also a boom in the market abroad. Macau has grown past what everybody predicted and Las Vegas has also witnessed a new vigor with many proposed building projects, and this has spurred a new set of interests in the casino stock investment all over the world.
Recovery of the UK Casino Market
Casinos have a very hard time attracting young people to their establishment. The generation Y and millennials are drawn to sports betting, especially when it is about football, but may find it difficult to sit down at the casino tables and play casino games.
The age group that patronizes the land based casinos more are people that are 40 years and above. But some young people are now being attracted back to the casinos as the focus shifts to the online casinos and because of the introduction of things like video game gambling.
Some casinos in the UK have also benefited from expanding into other countries, and there has been an increase in the global demand for gambling activities. The available data about what the casino operators gained in the UK last year puts it at £1 billion, which is a 13.5% increase in what it was in the previous year.
The meaning is that there is a possibility of huge profits for casino investors. We are going to look at the performance of the stocks of some of the leading casinos in the UK, to help investors in the UK to make a better decision when they want to invest.
Rank Group: RNK (LSE)
The Rank Group is among the biggest names in the gambling sector of the UK. They own the Grosvenor Casinos, Mecca Bingo and the internet based rank interactive. To increase their streams of income, the company had to get into several markets. In June, their stock prices were close to a 30 day increase at 221.30, and this followed a steady rise that they’ve witnessed since May. At the moment, the market value of the RNK is put at £864.58 million, and in 2016/17, the company bagged £71.1 million as profits. Rank is not expected to witness any huge or impactful change, and they have access to many gambling activities, and some other market sectors that are witnessing rapid growth.
Inter Game Tech: IGT (Nyse)
There has been a very huge and noticeable growth in the online game developers sector, and most of the leading software firms are making profits. International Gaming Technology otherwise known as IGT witnessed a very good year. It is a business that has a knack for innovation, and when some players won some of their uniquely high progressive jackpots at Vegas casino by the end of May, that placed them in the spotlight. Some investors get jittery when they have to make huge payouts, but that is not the same with IGT. They’ve witnessed a three months rise in the prices of their stock to close at 18.67, which is a 1.25% increase on a daily basis. The current market capitalization of IGT is $3.73, and this tends to signal a huge comeback after it witnessed a decline between 2015 and 2016. They are expected to grow further with the addition of new games and their sojourn into new and innovative territories.
William Hill: WMH (LSE)
The gains reported by some of the gambling firms have not been witnessed by the British bookmaker named William Hill, but there has been a steady increase in their value, and they are still within the predicted average for the year. They retain their position as a leader in the sports betting market, with a unit price of 283.20 on average, which means a 0.56% increase in profits for 200 days. William Hill is one of the biggest in the gambling market with its £2.43 billion market capitalization, and its sojourn into Australia and Europe places it in a vantage position in the lives of many bettors.
Paddy Power Betfair: PPB (LSE)
Paddy Power is an Irish-British bookmaker, and it is witnessing something like a different fate, which is full of uncertainties due to a bad business year. But even in the midst of all this, the firm still maintains high overall profit, and the business is still trusted. The company is witnessing a trading high of 8,485,000 at the moment, and its yearly dividend yield is currently 1.85%. This betting firm witnessed a slight drop in May, though the recovery has been steady since after May. The current price is 1.20% even when there are daily trading highs. The growth in revenue and sojourn into high street and online betting services has also boosted shares of the firm.
Net-Ent: NET-B (STO)
Netent is based in Sweden, but it is good to look at it too. This software developer came up with many new slots in the recent past, and they could be enjoyed in most casinos out there. These have become very popular and they have given players the chance to enjoy fresh gameplay.
Because of this, they have strong looking finances this year. They witnessed a 72.05 high point for unit prices this week, which is a very important development that is happening for the first time in the last 5 years. They are about to grow in potential profits with their new game licenses. So, UK investors can latch on them.
DISCLAIMER:
News, data and statement included in this article is intended exclusively for information purposes.
It should not be considered a recommendation for the purchase, retention, or sale of the securities referred to herein.