We recently published a list of 10 Largest Gambling Stocks of 2024. In this article, we are going to take a look at where Gaming and Leisure Properties, Inc. (NASDAQ:GLPI) stands against the other largest gambling stocks.
According to The Business Research Company, the global gambling market is expected to grow from $540.3 billion in 2023 to $744.8 billion in 2028, at a compound annual growth rate (CAGR) of 6.6%. Some major catalysts influencing the gambling industry include the legalization of gambling, rapid urbanization, increasing use of social media, and increasing involvement in sports betting applications. Factors that can hurt the growth are growing taxation on casinos and strict government oversight of the gambling industry.
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Two of the Leading Markets in the Gambling Industry
The gambling industry is evolving with more and more companies advancing in the sports betting arena. By the end of 2023, the gambling and casino industry had started showing signs of growth as strong gambling activity was experienced in Macau. According to the Statistics and Census Service, the tourist count crossed 28 million in Macau in 2023, increasing by 394.9% from 2022. In the U.S., Las Vegas continues to evolve and remain the largest gambling city in the country. According to Condé Nast Traveler, Las Vegas was the sixth most visited city for international visitors to the U.S. in 2023.
According to the hospitality consulting firm HVS, the Las Vegas Casino and Hotel Market hosted nearly 40.8 million visitors in 2023, surpassing the 40 million threshold for the first time since 2019. Between 2015 and 2019, over 42 million visitors traveled to Las Vegas each year before dropping to just over 19 million in 2020 due to the COVID-19 pandemic.
The deep effects of the pandemic are far behind now and tourism is back to normal in Las Vegas. In 2023, the gaming revenue for Clark County was around $13.5 billion, setting a market record for the second straight year. With new avenues and casino hotels, the gambling market is expected to continue its growth momentum.
Americans’ Support for Gambling
The majority of U.S. adults support casino gambling and sports betting. According to the American Gaming Association Survey, over 55% of U.S. citizens participated in some form of gambling in 2023, while more than 28% gambled at a physical casino. In addition, nearly 21% of people took part in sports betting. With increasing acceptance of gambling, 9-in-10 Americans find casino gambling to be acceptable for themselves or others. The gambling confidence among Americans is higher than ever before. Nearly 65% of Americans believe that the gambling industry is committed to supporting responsible gambling and overcoming problem gambling.
The gambling industry continues to thrive and the bullish sentiment remains strong among the investors. Over the 1 year, three of the largest gambling and sports betting ETFs have gained an average of over 27%, as of November 4. Roundhill Sports Betting & iGaming ETF (NYSEARCA:BETZ), Global X Video Games & Esports ETF (NASDAQGM:HERO), and VanEck Video Gaming and eSports ETF (NASDAQGM: ESPO) have soared over 16%, 24%, and 41%, respectively.
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Our Methodology
To compile our list of the largest gambling stocks, we simply made a list of the ten most valuable gambling firms in terms of market capitalization that are traded on U.S. stock exchanges, as of November 4. We also mentioned the number of hedge funds that had invested in the stocks during Q2 2024, and the data for hedge fund investors was obtained from Insider Monkey’s database.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
Gaming and Leisure Properties, Inc. (NASDAQ:GLPI)
Market Capitalization: $13.89 Billion
No. of Hedge Fund Investors: 25
Gaming and Leisure Properties, Inc. (NASDAQ:GLPI) is the first gaming real estate investment trust in the U.S. The company’s portfolio includes 65 premier gaming and related facilities which are operated by recognized industry leaders. The gambling REIT engages in acquiring, financing, and owning real property to be leased to gaming operators in triple net lease arrangements.
Gaming and Leisure Properties, Inc. (NASDAQ:GLPI) has a solid portfolio positioned well across the country and focuses on regional gaming markets. Considering the growth in the casino gaming industry, the REIT is confident in the long-term health of its casino gaming market.
During the third quarter of 2024, Gaming and Leisure Properties, Inc.’s total revenue increased by $25.70 million year-over-year to $385.30 million. The company experienced growth driven by the Tioga acquisition, which added $3.6 million in cash income, while the Rockford acquisition added $4.6 million in cash rental income. Additionally, another $1.5 million was added through the Casino Queen Marquette acquisition and the Baton Rouge landside development. Other developments and acquisitions also played a vital role in the growth of revenue. So far in 2024, the company’s investment activity of almost $2 billion has had an attractive blended yield of 8.40%. The company also paid a third-quarter 2024 cash dividend of $0.76 per share on September 27.
Overall, GLPI ranks 5th on our list of largest gambling companies in 2024. While we acknowledge the potential of GLPI as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than GLPI but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.