Early data for the first week of the National Football League season shows a large increase from the prior year with more states having legalized betting in place.
What Happened: The 2021 NFL season kicked off with 27 states having legalized online sports betting, according to Action Network. That’s a sharp increase from 19 states in 2020 and 12 states in 2019.
Thursday through Sunday saw a record 58.2 million transactions reported by GeoComply Solutions, a company used to verify the locations of users.
“We expected high volumes, but what we have seen has surprised us nonetheless,” GeoComply managing director Lindsay Slader said.
One area that surprised was Arizona, which recently legalized sports betting. Arizona launched on Thursday and saw 6.1 million transactions from 271,000 accounts tracked by GeoComply. The state had more wagers placed on its first day than other mature states.
“The level of demand across new markets, such as Arizona, indicates that consumers have long waited for the option to legally place a sports bet.”
Here is a look at the top 10 states by transaction volume:
- New Jersey: 21.4%
- Pennsylvania: 19.8%
- Michigan: 12.9%
- Arizona: 10.4%
- Illinois: 8.2%
- Virginia: 6.0%
- Indiana: 5.5%
- Tennessee: 5.2%
- Colorado: 3.7%
- Iowa: 3.1%
Related Link: Could Spinning Off Online Sports Betting Help Casino Stocks?
DraftKings had revenue of $614 million in 2020 and is guiding for over $1 billion in 2021. Flutter had 2020 betting revenue of $896 million in 2020, up 81% year-over-year.
DraftKings reported 1.6 million bets placed on the Thursday Night Football game between the Tampa Bay Buccaneers and Dallas Cowboys. Jason Robins, DraftKings CEO, said the bets placed Thursday was the most in company history.
BetMGM, a joint venture from MGM Resorts International (NYSE:MGM) and Entain, could be in for a strong season as it has grabbed market share gains in several states and ranks third or fourth in many states.
Another name to watch is Penn National Gaming (NASDAQ:PENN), which has the Barstool Sportsbook brand in several states and has grown its visibility after being legal in only Pennsylvania for 2020. Barstool Sportsbook had a strong start in Michigan before losing market share. With several launches under its belt, Barstool Sportsbook could have a new strategy in place to maintain market share.
Arizona has the 14th largest population in the U.S. and could be the state to watch for the 2021 season. Barstool Sportsbook, DraftKings, FanDuel and BetMGM all launched live in Arizona for the NFL opening game.
Sports betting platforms could have also had strong profits in week one with underdogs going 12-4 against the spread, the highest amount according to public record. Nine underdogs won outright including the Pittsburgh Steelers at odds of +232.
Another name to watch is the Roundhill Sports Betting & iGaming ETF (NYSE:BETZ). DraftKings, Flutter Entertainment and Penn National are all top ten holdings in the ETF. BETZ is up 20% year-to-date and up over 60% in the last 52 weeks.
DKNG shares are up 30% year-to-date and up 46% over the last year.
PENN shares are down 10% year-to-date and up 31% over the last year.
PDYPY shares are down 4% year-to-date and up 32% over the last year.
MGM shares are up 37% year-to-date and up 90% over the last year.
Photo: Anders Krøgh Jørgensen on Unsplash