---
title: "3 Online Sports Betting Stocks That Look Like Likely Winners"
description: "The U.S. online sports betting market is rapidly growing, with revenue expected to reach nearly $40 billion by 2026. Caesars Entertainment's digital unit, including its online sports betting app, is p"
type: "news"
locale: "en"
url: "https://longbridge.com/en/news/207424815.md"
published_at: "2024-06-27T14:25:17.000Z"
---

# 3 Online Sports Betting Stocks That Look Like Likely Winners

> The U.S. online sports betting market is rapidly growing, with revenue expected to reach nearly $40 billion by 2026. Caesars Entertainment's digital unit, including its online sports betting app, is performing well, generating $5 million in EBITDA and an 18.5% increase in revenue in Q1. DraftKings is also a top player in the online sports betting market, with strong financial performance and positive outlook. BetMGM, owned by MGM Resorts, is expecting to generate $500 million in EBITDA in 2026.

Sports betting is a huge, rapidly growing business in the U.S. According to **Statista**, the revenue of the U.S. online sports betting market reached about $19 billion in 2023, up from roughly $15 billion in 2022. And in 2026, the sector’s sales are expected to surge to nearly $40 billion.

Moreover, between 2024 and 2029, experts predict that the space’s compound annual growth rate will be an impressive 12%, while they estimate it will attract nearly 55 million users by 2029. Providing more evidence that the U.S. online sports sector is attractive, Carl Icahn, a renowned investor, and a multibillionaire, obtained “a sizable position” in **Caesars Entertainment** (NYSE:**CZR**), *Bloomberg* reported on May 31. One of Caesar’s most valuable assets is its digital unit.

Last quarter, the latter business, which includes an online sports betting app, generated $5 million in EBITDA, excluding certain items. Moreover, its revenue jumped 18.5% compared to the same period a year earlier to $282 million. Here are three top online sports betting stocks to buy now.

## DraftKings (DKNG)

Source: Lori Butcher/Shutterstock.com

**DraftKings** (NASDAQ:**DKNG**) is the most attractive pure play on online sports betting. On June 10, Morgan Stanley identified DKNG stock as “a top pick in the North America gaming and lodging sector.”

The bank believes that the company’s free cash flow has reached a positive turning point, while the firm is benefiting from the strong growth of the sports betting market and the sector’s relatively strong pricing trends.

Bank of America was also upbeat on DKNG stock earlier this month, as the bank added the shares to its list of best investment ideas.

On May 2, the company reported very strong Q1 results. Its top line jumped 53% versus the same period a year earlier to $1.17 billion, while its EBITDA, excluding certain items, came in at $22.39 million, versus an adjusted EBITDA loss of $221.6 million. Further, DraftKings raised the midpoint of its 2024 sales guidance to $4.9 billion from $4.775 billion, and the firm increased its adjusted EBITDA outlook to $500 million from $460 million.

The company’s strong financial performance makes it one of the best sports betting stocks to buy.

## Caesars Entertainment (CZR)

Source: Jason Patrick Ross/Shutterstock.com

As I mentioned in the introduction to this column, the well-regarded, multibillionaire investor Carl Icahn obtained a “sizeable position” in Caesars, according to a report by *Bloomberg* that was published last month. Icahn has had many successful investments. For example, he obtained a 64% profit from his stake in medical supplies company **Hologic** (NASDAQ:**HOLX**), versus the **S&P 500’s** gain of just 16% during the same period, while his investment in **Dell Technologies** (NYSE:**DELL**) yielded him a 14.5% gain, well above the S&P’s loss of 9.6% in the same time frame.

Moreover, as I noted in this article’s opening paragraph, the company’s digital unit, including its sports betting business, appears to perform very well. That’s because the division’s top line climbed 18.5% year-over-year to $282 million in Q1, while its adjusted EBITDA reached $5 million. That was a big improvement over the adjusted EBITDA loss of $4 million that the unit posted in Q1 of 2023 and represented the fourth straight quarter of positive adjusted EBITDA for the company’s digital assets.

Earlier this year, the company launched mobile sports betting in North Carolina. Over the longer term, its sports betting business will likely get a big boost from legalizing sports gambling in the large states of California, Texas, and Georgia. Efforts are underway to legalize the practice in all of those jurisdictions.

## MGM Resorts (MGM)

Source: Jason Patrick Ross / Shutterstock.com

BetMGM is an online sports betting and iGaming joint venture owned by **MGM** (NYSE:**MGM**) and U.K.-based **Entain** (OTCMKTS:**GMVHF**). Last year, BetMGM’s revenue jumped 36% to $1.96 billion, representing the upper end of the unit’s guidance of $1.8 billion to $2 billion. Also, BetMGM’s same-state revenue climbed 14% last year, while it generated positive EBITDA in the second half of the year.

BetMGM expects to generate EBITDA of $500 million in 2026. And according to *World Casino News*, BetMGM’s “first-time deposits (and) bonus levels” also climbed last year. Last year, the unit launched new operations in Ohio, Massachusetts, and Kentucky. In March, the unit started operations in North Carolina. The division’s 2024 financial results are likely to be boosted by its entrance into North Carolina and its first full year in the three states in which it launched in 2023. And like Caesars, BetMGM will probably get a big lift from the eventual legalization of sports betting in California, Texas, and Georgia.

Meanwhile, MGM, which has many casinos in Las Vegas, is also likely to get a big boost from the accelerating growth of gambling revenue in the city. I’m drawing that conclusion from the fact that the “gaming win” of casinos on the Las Vegas Strip jumped 6.6% versus the same period a year earlier to a record $666 million.

*On the date of publication, Larry Ramer held a long position in MGM. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines*.

Larry Ramer has conducted research and written articles on U.S. stocks for 15 years. He has been employed by The Fly and Israel’s largest business newspaper, Globes. Larry began writing columns for InvestorPlace in 2015. Among his highly successful, contrarian picks have been SMCI, INTC, and MGM. You can reach him on Stocktwits at @larryramer.

Consumer Discretionary, Travel, Casino

### Related Stocks

- [DKNG.US - Draftkings](https://longbridge.com/en/quote/DKNG.US.md)
- [CZR.US - Caesars ENT](https://longbridge.com/en/quote/CZR.US.md)

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> **Disclaimer**: This article is for reference only and does not constitute any investment advice.
