Casting an eye on Wagering stock that still has steam: PBH

  • Aug 10, 2020 AEST
  • Team Kalkine
Casting an eye on Wagering stock that still has steam: PBH

Summary

  • PointsBet shares generated a return of 110.28% in last one-year period, with its Australian business experiencing robust growth primarily due to preference for racing over sports, especially during pandemic period.
  • The Company’s recent agreements in the US market with Kroenke Sports & Entertainment, Twin River Management Group and Pacers Sports & Entertainment exemplifies the fact that PBH’s focus remains on providing a modern gaming experience for contemporary times.
  • In July end, PBH unveiled bolstered business performance for Q4 FY20 ended 30 June, and garnered attention for achieving turnover of A$302.9 million from the Australian market, reflecting a rise of 80.5% on pcp.
  • PBH is well-positioned to continue relishing consolidation of the sports industry and shifting of consumer behaviour towards online platforms. Furthermore, PBH shall carry on with its investment in iGaming and execution of its US strategy.

 

It seems like PointsBet Holdings Limited (ASX:PBH), an online bookmaker that offers products facilitating wagering on sports, has ended this week in an upbeat mood.

The good news continued to pour in for the premier online bookmaker throughout the week!

The announcement made on 7 August 2020 was the third consecutive positive announcement for PBH.

On 7 August 2020, PBH announced a new partnership with leading Denver, Colorado-based Kroenke Sports & Entertainment, LLC (KSE).

Interestingly, PBH’s share price has been climbing up on ASX and has generated a 48.82% return over the last three months.

Source: ASX

On 7 August 2020, PBH settled the day’s trade at AU$6.280, up by 2.614% from the previous close.  Also, the impressive 3-month return is buoyed by the positive business updates and soared earnings during the crisis period.

With this backdrop, let us deep dive and appraise ourselves with the latest announcements and financial performance of the Company.

PointsBet’s multi-year partnership with Kroenke Sports & Entertainment, LLC

On 7 August 2020, PBH announced a multi-year partnership with Kroenke Sports & Entertainment, LLC, (KSE) a leading entertainment, ownership and management group.

Through this deal, the Company would become an exclusive gaming partner of the National Lacrosse League’s Colorado Mammoth, National Basketball Association’s Denver Nuggets, National Hockey League’s Colorado Avalanche, and their home arena, Pepsi Center.

Additionally, PointsBet has been named as an official sports betting partner of KSE’s Altitude Sports Radio and Altitude TV, featuring PBH’s data integration in pre-game as well as ingame features.

Notably, the agreement’s exclusivity range throughout the entire gaming category, consisting of retail and online sports betting, free-to-play games, online casino and daily fantasy.

Online iGaming market access secured in New Jersey

On 6 August 2020, PBH disclosed that its wholly owned subsidiary PointsBet New Jersey, LLC has inked a ‘primary skin’ agreement with Twin River Management Group, Inc, an owner, and manager of nine casinos.

The deal was locked with a perspective of providing iGaming/online casino services (complement to its critically acclaimed sportsbook) in the State of New Jersey via PBH’s mobile app and website platforms that are pending final regulatory approvals and licenses.

Furthermore, PBH is noted to pay Twin River a portion of the net gaming revenues derived from operations of its New Jersey iGaming/online Casino operations; PointsBet would also be accountable for the licensing and regulatory costs concerning launch and operations of PBH’s services.

Notably, the 10-year deal is subject to completion of the acquisition of Bally’s Atlantic City Hotel & Casino in Atlantic City, New Jersey by Twin River and PBH receiving the essential regulatory licenses and approvals.

PBH appointed as an official sports gaming partner of the Indiana Pacers NBA Team

On 5 August 2020, the Company announced that one of its wholly-owned subsidiary PointsBet USA Inc. (PBH USA) has secured a multiple year agreement with Pacers Sports & Entertainment (Pacer), an integrated sports and entertainment firm, to become the official sports gaming partner of the Indiana Pacers in the National Basketball Association (NBA).

Furthermore, as per the agreement, PBH’s signage would be displayed throughout the Pacers’ home arena Fieldhouse in Indianapolis. Also, the Company would have a presence on the digital channels of Pacer and offer exceptional promotions to the Indiana Pacers’ fans.

Did you read; Some stocks that have helped investors cash-in the bets: PointsBet, Sezzle

Impressive business performance during FY20

On 28 July 2020, PBH unveiled its strong performance during  Q4 FY20 ended 30 June, and highlighted that its Australian trading business achieved turnover and net win of AU$349.4 million, AU$33.5 million, for Q4 FY20, reflecting a Q-o-Q increase of 57.9%, 355.7%, respectively.

Furthermore, the US trading business generated a turnover of AU$46.5 turnover in Q4 FY20, and net win stood at AU$1.2 million.

Notably, active clients in Australia and the US soared to 90,422 and 20,939, respectively at the end of 30 June 2020.

Source: ASX announcement

Despite the fact that sports-related events were either cancelled or deferred due to the pandemic in Australia, the Company emerged stronger with considerable improvements in Q4 FY20 as compared to pcp across metrics such as bets per client, net win per client and turnover per client.

Furthermore, PBH also divulged its bolstered financial position with AU$135.4 million corporate cash (held majorly in USD) by 30 June 2020.

A sneak-peek at other activities of PBH during the fourth quarter are as follows:

  • On 31 July 2020, PBH announced that its partner, Hawthorne Race Course Inc. had received Master Sports Wagering Licence. Further on 16 July 2020, the wholly-owned subsidiary of PBH, PointsBet Illinois, LLC was issued a Temporary Operating Permit by the IGB (Illinois Gaming Board).

Following these two approvals, PBH would commence both retail, as well as online sports betting operations in Illinois.

  • On 9 July 2020, PBH USA partnered with BetMakers DNA Pty Ltd to commence Fixed Odds betting on horseracing in New Jersey, contingent on receipt of all mandatory regulatory approvals.
  • On 3 July 2020, PBH USA announced that it had entered into a new multi-year deal to become an official betting partner of the Detroit Tigers Major League Baseball (MLB) team.

Did you read; Casino, Wagering and Gaming Stocks to Look at: CWN, ALL, PBH, BET 

 


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