Casino shares rally on sports betting decision

Shares of casino operators spiked in trading Monday after the Supreme Court voted 6-3 to overturn the federal ban on sports betting.

Caesars Entertainment’s stock rose more than 5% after the decision, Penn National Gaming climbed more than 4% and MGM Resorts International advanced roughly 2%. Boyd Gaming, Scientific Games and Eldorado Resorts also saw positive results on the announcement.

"MGM Resorts International applauds the Court's decision to allow states the opportunity to protect consumers and benefit the public by regulating and taxing sports betting,” the casino operator said in a statement. "We look forward to working with legislators and policy makers to achieve a regulatory outcome that benefits states and consumers alike while ensuring the integrity of sports.”

The Supreme Court’s decision repealed a 1992 federal law that banned sports betting in all but four states, including Nevada. States will now be able to consider whether to legalize sports wagers on a case-by-case basis.

Ticker Security Last Change Change %
BYD BOYD GAMING CORP. 62.26 -1.11 -1.75%
SGMS n.a. n.a. n.a. n.a.
ERI n.a. n.a. n.a. n.a.

The legal sports betting marketplace could be worth more than $57 billion, The Associated Press reported, citing projections from Jefferies analyst David Katz. Aside from casinos, daily fantasy sports operators such as DraftKings and FanDuel are also expected to benefit from the Supreme Court’s decision.

The American Gaming Association, which represents the U.S. casino industry, estimates that Americans spend $150 billion on illegal wagers annually.

“Today’s ruling makes it possible for states and sovereign tribal nations to give Americans what they want: an open, transparent, and responsible market for sports betting,” the group said in a statement. “Through smart, efficient regulation this new market will protect consumers, preserve the integrity of the games we love, empower law enforcement to fight illegal gambling, and generate new revenue for states, sporting bodies, broadcasters and many others.”

The NFL, NBA and other sports leagues called for strict regulation of sports betting after the court’s decision.