On the heels of stock growth, acquisition rumors and potential sports betting legalization in Canada, theScore is making more moves.
The Canadian media company and sportsbook operator is launching theScore Bet in its fourth U.S. state today: Iowa. It is the third launch in six months for theScore, joining Indiana and Colorado.
It first launched in New Jersey in 2019. With the Iowa launch, theScore becomes the eighth mobile betting operator in four or more states.
Why Iowa next for theScore?
As one of 11 states in which theScore gained market access through a deal with Penn National Gaming, theScore president and chief operating officer Benjie Levy said the company is just making its way through those markets. Indiana was the first of those states.
Iowa’s transition from in-person registration to mobile registration last month sealed the deal. Mobile registration helped boost Iowa’s monthly handle to $149.5 million in January — a 42.7% increase from December’s $104.8 million.
It won’t be the only state launch for theScore in 2021, either. Between already acquired market access deals and actively pursuing more, Levy is confident more will come.
“We want to be a national operator,” Levy said. “We’ll be rolling into the greatest number of states possible.”
More states bring more money
With Colorado and Indiana adding to its total handle, theScore’s Super Bowl LV handle grew five times last year.
In its fourth-quarter earnings report, theScore reported a handle of $44 million, a 535% year-over-year increase.
The company posted an EBITDA loss of $7.3 million in the quarter as it rebounded from the pandemic sports stoppage.
Does market position make theScore an acquisition target?
With theScore’s legacy stemming from a sports TV station, Levy said the brand is built into sports consciousness in Canada.
That media brand connection is also leaned on as it enters U.S. states, which Levy claims helps the brand spend less than its competitors. He’d rather have a smaller base of dedicated consumers than spend millions to secure 30% market share.
“When we go into a new market, we already have this entrenched base of fans,” he said. “Other brands enter new markets and have to introduce themselves and what they mean.”
That brand position has rumors swirling of a potential acquisition, largely centering on DraftKings.
“I absolutely think theScore is an attractive takeout target,” Eight Capital analyst Suthan Sukuamar told LSR last week. “Think about the asset these guys have built. It’s the only real media and betting platform that’s actually working. Everyone talks about it but no one truly has a platform like this. It’s a very attractive target for an online gaming incumbent or a land-based player to accelerate their digital strategy.”
Levy sidestepped those comments while acknowledging the overall potential.
“I can’t comment on what other companies think about us or the opportunity they see, but we see tremendous opportunity in this industry, in the U.S. and Canada,” he said.
A bullish stock?
Spurred by early talks of Canadian legislation, the Score Media and Gaming stock price soared more than 600%.
Trading at $4.20, it still pales in comparison to other gaming stocks like DraftKings and Penn National.
Levy just had one question: “Why did it take so long?”
“It’s not a surprise when you look at how the market has received other companies focusing on this space,” he said. “It’s great to see that value recognized in the market. We’re only at the beginning.”
Another influx of capital could come as theScore looks poised to list in the U.S. as well.
Potential of the Great White North
The Canadian Parliament should start sports betting legalization discussions this week. That potential has theScore in a prime position to capitalize on a market with an addressable market of up to $5 billion.
Ontario alone would be the most populous North American jurisdiction with online betting if it launches before California, Florida, New York and Texas.
In the province of more than 14 million, theScore already has 1.4 million users on its media app. Looking at the demographics, Levy believes that’s more than 10% of the likely betting population.
“We’re very excited about our position here,” he said.