The 2024 National Collegiate Athletic Association (“NCAA”) Division I Men's Basketball Tournament will kick off on Mar 19, spreading “March Madness” among millions of Americans. Though it will divert a large number of Americans from the stock market and dry up trading volumes, it will lead to a buying frenzy and strong stock gains.
The champion will be crowned on Apr 8 at the State Farm Stadium in Glendale, AZ. Being the biggest modern sporting event in the United States, the tournament is a money-spinner for sports-betting companies, sponsors, media networks (TV and digital) and networking players, attracting billions of revenues in just three weeks.
As such, investors can easily basket some gains from the three-week sports-betting extravaganza by jumping into the stocks in these spaces. You can consider DraftKings Inc. DKNG, The Coca-Cola Company KO, NIKE Inc. NKE, Warner Bros. Discovery WBD and Capital One Financial Corporation COF to make the most of the exciting March Madness.
Sports betting has never been more accessible to Americans than in recent years, as gambling is now legal in more states and growing in popularity. The legalization of sports betting across the United States has increased significantly since 2019, with online gambling now legal in 38 states and the District of Columbia.
According to the American Gaming Association, Americans will legally bet $2.72 billion on the upcoming men’s and women’s NCAA basketball tournaments with American sportsbooks. This represents roughly twice the amount legally wagered on this year’s Super Bowl, according to the AGA’s head of research, Dave Forman.
March Madness is available for betting at sportsbooks like DraftKings, FanDuel, BetMGM and BetRivers. DraftKings Sportsbook is known for its user-friendly interface and a wide selection of bets, making it a go-to for beginners and seasoned bettors. FanDuel stands out for its clean design and easy navigation, offering a variety of betting options, including popular same-game parlays. BetMGM combines the prestigious MGM brand with competitive odds and a broad selection of bets for March Madness. Known for its straightforward platform and rewarding loyalty program, BetRivers is a solid choice for placing your bets.
Per estimates from the latest report from research firm Eilers and Krejcik Gaming, 35-40% of the amount bet on the men's NCAA tournament will come from in-game wagers and 5% of the handle will be generated from same-game parlays.
Sponsors invest millions in advertising and marketing the March Madness phenomenon, and are expected to gain traction from the competition. The TV media companies are also expecting the lucrative event with CBS Sports and Warner Bros. Discovery Sports continues to score maximum revenues from the event by broadcasting through four networks — CBS, TNT, TBS and truTV.
Stocks to Bet on
DraftKings is the only U.S.-based vertically integrated sports betting operator. DKNG is a multi-channel provider of sports betting and gaming technologies, powering sports and gaming entertainment for 50 operators across more than 15 regulated U.S. and global markets, including Arkansas and Oregon in the United States. DraftKings' Sportsbook offers mobile and retail betting for major U.S. and international sports, and operates in the United States, pursuant to regulations in Colorado, Illinois, Indiana, Iowa, Mississippi, New Hampshire, New Jersey, New York, Pennsylvania, Tennessee and West Virginia.
The stock currently has an estimated earnings growth of 86.1% for this year and a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.
Coca-Cola manufactures, markets and sells various nonalcoholic beverages worldwide. It provides sparkling soft drinks, sparkling flavors; water, sports, coffee, and tea; juice, value-added dairy, and plant-based beverages; and other beverages. Coca-Cola is one of the top three sponsors of NCAA March Madness and its no-calorie beverage — Coke Zero — is the lead soft drink brand in the tournament.
Coca-Cola has an estimated earnings growth of 4.5% for this year and a Zacks Rank #3 at present.
Nike is engaged in the business of designing, developing and marketing athletic footwear, apparel, equipment and accessories, and services for men, women and children worldwide. It continued to dominate as the top shoe and jersey provider of teams in the NCAA Tournament.
Nike has an estimated earnings growth of 9.6% for the fiscal year (ending May 2024) and a Zacks Rank #3.
Warner Bros. is a premier global media and entertainment company that combines WarnerMedia Business’s premium entertainment, sports and news assets with Discovery’s leading non-fiction and international entertainment and sports businesses, thus offering audiences a differentiated portfolio of content, brands and franchises across television, film, streaming and gaming. Warner Bros. Discovery will stream NCAA games on their respective streaming services.
Warner Bros. has an estimated earnings growth of 73.4% for this year and a Zacks Rank #3 at present.
Capital One is primarily focused on consumer and commercial lending, as well as deposit origination. The company is the presenting sponsor for the NCAA’s official bracket challenges for the tournament. Capital One will also sponsor the March Madness Fan Fest and the March Madness Music Festival during the weekend of the men’s Final Four in Houston.
Capital One currently has an estimated earnings growth of 10.4% for this year and a Zacks Rank #3.
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