Wall Street Bets is a roundup of recent notes from analysts covering the gambling industry.
Accel Entertainment benefits from favorable terms for VGTs
Truist Securities’ Patrick Keogh on December 24 looked at the prospects for Accel Entertainment, a supplier of video game terminals:
“Yesterday, it was reported that VGTs look likely to come to Chicago in the new year at favorable terms to operators (notably, no additional city-level tax). We had expected Chicago VGTs to launch in the mid-term (at least after Bally’s — Hold, per Barry Jonas — opened its downtown casino resort in Sept 2026), though the alternative budget accelerates the timeline meaningfully. We see the news as a material positive for Accel, who we launched on with a Hold rating last week given some concerns over a slowing Illinois market. We note shares reacted favorable yesterday with Accel up +3.5% (vs. Standard & Poor up +0.5%) though are down slightly today (vs. S&P up slightly).”
Regional markets show promise
David Katz of Jefferies examined regional gaming operators:
“Overall, regional market performance should be bifurcated as firms seek to combat the proliferation of external competition through increased capital investment. The capital investments of Churchill Downs and Boyd should increase value over time, while the appropriate investments by Penn Entertainment in its properties are offset by less productive digital investment. To this end, the Street’s patience for limited-productivity digital gaming investments by land-based operators has worn thin (Caesars, Penn), which we expect to continue evolving in 2026-27.”
New York online sports betting growth
Estelle Weingrod of J.P. Morgan looked at figures supplied by the New York Gaming Commission regarding online sports betting:
“The most recent OSB data was for the week ending December 21 (NFL Week 16), recording handle growth of 12% year-over-year and GGR growth of 9% year-over-year, translating to an implied hold rate of 6.3% (down 18 basis points year-over-year). For Q4 to date (covering the period from September 29 to December 21), the OSB handle was up 12% year-over-year, with GGR up 36% year-over-year, thereby resulting in an implied hold rate of 9.8% (up 174 basis points year-over-year).”