Reuters recently reported that
Wynn Resorts Ltd
) has joined the bandwagon of applicants seeking Internet gaming
license in New Jersey. New Jersey sanctioned the online
gaming law in February this year. Online gaming in the state is
expected to start in late November, which might get postponed to
Per Reuters, 12-land based casinos in New Jersey will offer
Internet gaming in partnership with online gaming companies.
Further, this legalization will also levy higher taxes on online
gambling revenues compared to the current tax rate being imposed
New Jersey is in fact the third state after Nevada and
Delaware to legalize online gambling. Ironically, Wynn does not
own a casino in Atlantic City, NJ. Therefore, it will have to
team up with a brick-and-mortar casino, which currently holds a
license, to develop or offer games.
We believe that a slow but steadily recovering US market
prompted Wynn Resorts -- a Zacks Rank #3 (Hold) company -- to
focus more on the domestic market. It is worth mentioning that
the casino operator is reeling under pressure in Macau with just
2.6% growth in the recently concluded second quarter of 2013
while its Las Vegas operation witnessed an upside of 16.2%,
indicating brighter prospects in the domestic market.
Apart from Wynn Resorts, other casino operators such as
MGM Resorts International
Caesars Entertainment Corp.
) also remain quite hopeful on the growing demand for online
gaming in the US. Reuters reports that analysts estimate online
gambling to generate up to $1 billion annually in New Jersey and
$50 million to $250 million in Nevada every year.
To capitalize on this opportunity, in Oct 2011, MGM
collaborated with web poker firm Bwin - the owner of PartyPoker
and World Poker Tour -- to offer online poker in the US once it
is legalized. Another operator
Boyd Gaming Corp.
) also entered into a partnership with Bwin.party. Caesars
Entertainment is expected to launch real-money online poker in
Nevada under the World Series of Poker brand by the end of this
BOYD GAMING CP (BYD): Free Stock Analysis
CAESARS ENTERTN (CZR): Free Stock Analysis
MGM RESORTS INT (MGM): Free Stock Analysis
WYNN RESRTS LTD (WYNN): Free Stock Analysis
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