888 holdings stand to benefit the most out of DoJ decision

Lee Bell
December 29, 2011
1 Comment

888 holdingsOnline gaming providers, 888 Holdings, stand to benefit the most out the US Department of Justice’s pre-Christmas bombshell (that makes the Wire Act apply only to sports betting) a broker has proclaimed.

News of the DoJ’s decision, which has opened the door for US states to legalise online poker, casino and lotteries, has sent shares in 888 Holdings, as well as other online gambling providers, to rise sharply as trading resumed after the Christmas break yesterday.

The broker, who goes by the name of Panmure Gordon, upped the target price for 888 shares from 60p to 63p and kept its buy stance. Considering 888 Holdings has a commercial relationship with Caesars Entertainment, the broker said the DoJ’s decision is particularly relevant given Nevada passed online poker regulation last Thursday – with licences expected to be granted in the Spring. In addition, Gordon said the move by the DoJ would also remove the legacy legal risk from operating casino and poker websites in the US prior to October 2006.

The broker also announced that Bwin.party Digital Entertainment – who  has agreements with two Las Vegas operators, Boyd Gaming and MGM Resorts – and tech supplier Playtech, too, will benefit from the DoJ’s move (or what some people are calling an early Christmas present).

Following the DoJ’s announcement, Illinois and New York, also requested if they could use the internet to sell lottery tickets in their states. The DoJ’s announcement has certainly caused a stir in the US gambling industry, but what where do you think it will ultimately lead?

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Tags: 888 Holdings, Article, broker, business news, Caesars Entertainment, DoJ
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  • Gerald Williams

    888 is very well placed to take advantage of the USA market re-opening. The potential liability to the US authorities that was hanging over its head will disappear. Its now a question of who partners with 888 and in what timescale. Caesars are in pole position and will want to protect that partnership – but opportunities like this come along infrequently and I presume there are plenty of land based operators in the USA who will want 888′s technology and know-how. Either way – the improvements that 888 have made throughout 2011 in P&L and their balance sheet (impairments etc) has now put them in a very strong financial and opportunistic/strategic position for 2012. How long before Brian Mattingley becomes CEO – asap I would suggest because he and the other C level execs are doing a fantastic job. I bet the 888 board have been re-assessing a lot of options since the DOJ announcement…!