The increasing legalization of gambling in the U.S. and the recent reopening of physical casinos could drive steady growth in the gambling industry. So, based on that premise, we think it could be wise to bet on Scientific Games (NASDAQ:SGMS) and International Game (IGT). These gaming companies possess solid financials and favorable analyst sentiment. Read on.COVID-19-pandemic-led restrictions proved to be a massive hurdle for the gambling industry last year because physical casinos had to be closed for a major part of the year. However, companies that provide online gambling services were able to generate significant returns. Along with rising demand for online gambling, the reopening of physical casinos on the nation’s fast-paced and effective vaccination drive should buoy the industry’s growth. According to Research and Markets, the global online gambling market is expected to hit $72.02 billion in 2021, growing at a 12.3% CAGR.
Furthermore, New York Governor Andrew Cuomo signed budget legislation on April 19 that includes the framework for New York’s online sports betting plan, making online sports betting legal in New York. With the increasing legalization of gambling across the country, many companies that operate in this space are well positioned to benefit.
Investors' interest in the gambling space is partly evidenced by Roundhill Sports Betting & iGaming ETF’s (BETZ) 34.8% gains over the past six months compared to the SPDR S&P 500 ETF Trust’s (SPY) 15.3% returns. Given this backdrop, we think it could be wise to bet on fundamentally-sound gambling stocks Scientific Games Corporation (SGMS) and International Game Technology PLC (NYSE:IGT).