Last week’s milestone piece of US gambling news, namely the support that New Jersey Gov. Chris Christie expressed for a modified online gambling bill, as well gambling proponents’ estimate that these modifications could be implemented in a matter of weeks, gave a much needed boost to some gaming stocks.
Zynga, which has been working hard on developing its real-money gaming offers, saw its shares bounce back by 11%. Of course, that still makes it only USD 3.43 a share – a far cry from the high of USD 15.91.
Nevertheless, it shows that markets have considerable trust in NJ gambling legalization, as well as Zynga’s ability to exploit the market opportunities.
Encouraging state news were not the only reason behind Zynga share prices going up. Increasing revenues also played a part. A major factor behind Zynga’s results was its mobile gaming activity: a quarter of its 300 mln users play its games on mobile.
Zynga has been offering its real-money products in the UK, because British regulations – unlike current American gambling laws – allow such online activities. Though the news out of New Jersey is promising for Zynga’s US business development, the company is not planning to neglect its UK customers either: the company will launch new games for British players within a couple of months.
Nevertheless, as several US states are moving towards legalization and interstate compacts, Zynga has excellent chances to take advantage of the changing environment. It has already applied for gambling licenses in Nevada, so expectations are that establishing itself in New Jersey thereafter would thus be simpler.
The prospect of impending legalization of online casinos in New Jersey also pulled up Caesars Entertainment, with the stock going through a 38% rally. The company owns casino resorts in Atlantic City.