Global financial behemoth Morgan Stanley comes into focus as it presents its impressive prediction for the upcoming year in the always changing US gaming market. Concentrating on the consumer discretionary sector, the company highlights the remarkable compound annual growth rate (CAGR) of 17% for online sales between 2023 and 2026, designating it as the “single highest growth opportunity.”
Despite its reputation for supporting technical innovation, Morgan Stanley has low expectations for the world of online casinos. Recognizing that legislative procedures will move slowly in 2024 and 2025 and that things will likely level off following a time of extraordinary development, the situation is both encouraging and difficult.
Morphing Timelines and Total Addressable Markets
Morgan Stanley’s study causes a rearranging of launch dates for different online sports betting and casino markets, navigating the complex web of industry factors. Among the noteworthy modifications are those made to North Carolina and Maryland, which will see updated plans in the middle of 2024 and the fourth quarter of 2024, respectively. The shifting sands of Colorado, Indiana, and Iowa are reflected in the Total Addressable Market predictions, where the ripple effect is evident.
The company’s predictions for the sports betting Total Addressable Market, which project amounts of $13.4 billion (2024), $15.5 billion (2025), and $16.9 billion (2026), are impacted by these calculated reschedulings. Concurrently, the iGaming TAM projections indicate a strong increase of almost 20%, amounting to $7.1 billion, $8.8 billion, and $10.5 billion over the same three-year period.
The respected analysts at Morgan Stanley present a convincing story, claiming that US sports betting expenditures have not only overtaken those in the UK but are almost on par with Australian estimates at this point. The company believes that if additional states legalize sports betting, these spending levels will rise to considerable percentages of people’s consumer expenditure, maybe surpassing more developed economies.
Morgan Stanley makes its preferences known in the stock market by naming DraftKings as one of its “most preferred overweights” and projecting an optimistic $40 share price. With a $59 price objective, Las Vegas Sands maintains its position in the brick-and-mortar market. Fanatics, a recent addition, is seen as a “possible surprise” because of its strong tech stack and well-known sports brand.
Morgan Stanley envisions a sustained dominance for the current winners, FanDuel and DraftKings. The industry leaders are well-positioned to eliminate most of their competitors by utilizing their scale advantages, which will secure their dominance in the rapidly evolving US gaming sector.
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