888, Bwin.Party Surge on New Jersey Gambling Plan: London MoverColm Heatley
Bwin.Party Digital Entertainment Plc and 888 Holdings Plc led a surge among gaming companies in London after New Jersey Governor Chris Christie said he’s willing to allow online gambling if certain conditions are met.
Bwin.Party rose 16 percent, the biggest increase since December 2011, while 888 Holdings gained 17 percent to the highest price in more than four years. The two companies led advancing stocks in the FTSE All-Share Index, while Playtech Ltd., a gaming software developer, and betting firm Sportech Plc were among the top 10 gainers.
Christie said yesterday he would support a 10-year trial for online betting in the state to see whether it helps struggling Atlantic City casinos. He vetoed a bill and sent it back to lawmakers with recommended changes including the time limit, an increase in the tax on Internet bets and more money to help problem gamblers.
“This is a better than expected outcome and paves the way for online poker in New Jersey by September this year,” Simon French, an analyst at Panmure Gordon in London, wrote in a note today. He has a buy recommendation on all four companies.
New Jersey Senator Raymond Lesniak, a Democrat who sponsored the bill, said he expects the changes to be approved by the state Assembly this month and by the Senate in March, paving the way for a signature from the Republican governor and for online bets to be taken in September.
“We had thought it most likely that the governor would veto the bill,” Ivor Jones, an analyst at Numis who has a buy rating on 888 and Bwin.Party, wrote in a note today. “This is much better news.” Jones said a start to online gambling in New Jersey could encourage other states to follow suit.
Shares of Caesars Entertainment Corp., the largest operator in Atlantic City with four casinos, were up 27 percent at 11:41 a.m. in New York, after rising 19 percent yesterday. 888 has a joint venture agreement with Caesars.
“While it is still early days, we are very excited by the opportunities that the U.S. market looks set to provide,” a spokesman for 888 said today in an e-mailed statement.
Playtech, which said yesterday its fourth-quarter earnings rose as William Hill Online delivered a record contribution to the company, gained 8.6 percent in London. Sportech advanced
5.6 percent. Betfair Group Plc rose 2.1 percent.