Posted on: February 6, 2023, 02:35h.
Final up to date on: February 6, 2023, 03:26h.
Gaming gadget producer PlayAGS (NYSE:AGS) introduced right this moment it reached an settlement with DraftKings (NASDAQ:DKNG) to produce the gaming firm with content material for its web slot choices.
Monetary phrases of the settlement weren’t disclosed. However the pact requires PlayAGS to supply DraftKings with greater than 20 of its proprietary slot titles to be used on the latter’s web on line casino platform, which is likely one of the largest in North America. In New Jersey — the most important iGaming market within the US — 10 PlayAGS titles are presently dwell on the DraftKings on-line on line casino.
Extra new titles are scheduled to go dwell within the months forward, together with the deliberate launch of the extremely acclaimed Golden Wins Deluxe sport theme, which is nominated within the 5th Annual Eilers & Krejik Gaming (EKG) Slot Awards within the iGaming class for top-performing new on-line sport,” in line with a press release.
Las Vegas-based AGS is well-known for offering slot machines to land-based casinos all through the US, together with tribal venues.
For PlayAGS, ‘Appreciable Accomplishment’
Not surprisingly, PlayAGS is bullish on the settlement with DraftKings.
“The launch of AGS’ real-money gaming (“RMG”) content material on DraftKings On line casino represents a substantial accomplishment for the Firm,” mentioned AGS Vice President Gary Hardy within the assertion.
There’s benefit to that positivity, as a result of iGaming is likely one of the fastest-growing corners of the broader gaming business. It requires much less overhead than land-based casinos, and its margins are superior to these of on-line sports activities betting. Moreover, with only a handful of states presently permitting on-line casinos, web gaming’s legislative progress runway is extra enticing than that of sports activities betting.
New Jersey is one among six states that let regulated on-line on line casino video games. The others are Connecticut, Delaware, Michigan, Pennsylvania, and West Virginia.
Whereas six is much fewer than the quantity permitting sports activities betting, the variety of iGaming states is predicted to extend within the years forward as extra states embrace new revenue-generating sources. There’s already hypothesis that Illinois, and maybe Indiana, could possibly be among the many subsequent states to allow regulated on-line on line casinos.
Analysts Bullish on PlayAGS
Information of the settlement with DraftKings arrives as PlayAGS inventory is in rally mode. Following a tough 2022, the shares are up 34.60% for the reason that begin of 2023, and a few sell-side analysts are bullish on the slot machine maker this 12 months.
“We see CY23E/CY24E market share beneficial properties and upside to consensus estimates because of its Spectra 43 cupboard launch, the highest performing Portrait Upright, in line with Eilers & Krejcik surveys, and entrance into new classes/segments of the ground, together with mechanical reels, VLTs, WAPs and high-denomination video games,” wrote B. Riley analyst David Bain in a latest report.
The analyst additionally highlighted AGS gaining licenses in a number of new states and the potential for gaming enlargement in Texas as among the many potential catalysts for the inventory. He charges the gaming identify “purchase” with a $14 value goal, implying it could actually greater than double from present ranges.