Macquarie: Online Gaming and Betting Stocks to Flourish Despite the Headwinds

iGaming stocks are rising incredibly fast, with many experiencing much faster growth than some of America’s top stocks. According to analysts, this rise is poised to continue despite certain regulatory headwinds in the US.

Online Gaming Stocks on the Rise

According to Chad Benyon, an analyst for Macquarie Equity Research, iGaming stocks are rising roughly three times as fast as stocks in the S&P 500 Index. The S&P 500 Index, for context, is a stock market index tracking the stock performance of the top 500 listed companies in America.

Benyon clarified that the past four weeks have seen the iGaming stocks experience a growth of 12%, far exceeding the S&P 500’s 4% growth. He added that these figures correspond to a period of considerable hold percentages for iGaming companies, especially online sportsbooks. Based on the trends, Benyon believes that the iGaming hold percentage for Q2 will stand at around 11%.

Benyon was especially bullish on the B2C Online segments, trusting in companies such as Flutter (FanDuel), DraftKings, Caesars, RSI and BetMGM to continue excelling. In terms of B2B, he cited Sportradar as a company with bright prospects.

Another positive was the upcoming legalization of sports betting in Missouri, the overall increase in online sports betting handle across the US, and the stellar growth of online casinos.

The Industry to Flourish Despite the Challenges

At the same time, the online gaming and betting industries continue to face some challenges too as more and more states consider higher taxes for the verticals. Illinois is perhaps the most noteworthy example as the state recently introduced a significant tax hike, forcing the biggest operators in the state to implement a surcharge in order to remain profitable.

At the same time, analysts believe that New Jersey, which has historically been one of the most gambling-friendly states, would also introduce a tax increase, raising its tax on iGaming and online sports betting to 19.75%. Benyon went a step further and suggested that lawmakers could push for a 22% tax instead.

Despite that, Benyon still trusts in an optimistic GGR outlook for 2025, saying that the forecasts have only gotten better.

Benyon cited DraftKings as one of the top iGaming picks but added that his team prefers RSI due to its more diversified presence. However, Benyon said that Flutter and its FanDuel brand remain unrivaled in terms of global growth.