Please ensure Javascript is enabled for purposes of website accessibility

MGM Resorts Sees NBA Partnership as a Path to Sports Betting Dominance

By Travis Hoium - Aug 4, 2018 at 8:30AM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The casino-resort operator is building out a powerful sports betting platform.

MGM Resorts (MGM 3.15%) is trying to become the go-to place for sports betting -- and not only in Las Vegas, but nationwide. A recent U.S. Supreme Court ruling opened up sports betting across the country, and that in turn has created opportunities for online betting and in-person wagers on games across the country. 

The biggest move announced this week was a partnership with the NBA that will allow MGM to use the league's data and images in its wagering. It's possible that this will become a relationship that gives MGM a big lead in sports betting nationwide. 

Person holding money up on basketball court.

Image source: Getty Images.

Laying the groundwork for sports betting

Before it could make its play to become a sports betting powerhouse, MGM needed to fill some gaps in its business. One key move was to expand the number of jurisdictions where it could offer sports betting, which it did with a partnership with Boyd Gaming Corporation (BYD 5.83%) that allows betting where either company has a gaming presence.

MGM says the deal with Boyd creates a path to offering online and mobile sports betting in 15 states. But that was just the start of its strategic moves. 

MGM also launched a 50/50 joint venture with GVC Holdings PLC to "create a world-class sports betting and online gaming platform in the United States." This will allow dynamic sports betting on games like professional basketball across the country.

MGM lands a big NBA deal

The Boyd and GVC deals were really precursors to a partnership with the NBA and WNBA, which was announced Tuesday. Here was a key line from the press release announcing the deal:

As part of the partnership, MGM Resorts will use official NBA and WNBA data and branding, on a non-exclusive basis, across MGM Resorts' land-based and digital sports betting offerings throughout the United States. 

Data may not sound like a big deal in this partnership, but MGM will be able to expand betting options with access to this data. Customers can bet on things like the shooting percentage of a player, points in a quarter, assists, number of passes in a game, and a multitude of other items. Expanding the number and type of bets players can make and bringing them to regional and mobile platforms will give MGM Resorts a huge leg up in sports betting.

NBA and WNBA branding will also make the MGM betting platforms look more official for players. That could be a differentiator for MGM in competitive markets like Las Vegas, where small differentiations can be meaningful. 

One critique of the partnership is that it's non-exclusive and will provide a template for competitors like Caesars Entertainment and Penn National Gaming to sign similar partnerships. Getting to the NBA first is good, but may not be a lasting differentiation for MGM Resorts if it doesn't gather a critical mass of sports betting customers quickly. 

MGM wants to be a sports betting giant

The three partnerships announced this week lay the groundwork for MGM Resorts to become a big sports betting business. Not only will it be big in Las Vegas, but it could also be a favorite for mobile betting given its large geographic reach and partnership with Boyd Gaming. If anyone is going to be a big player in sports betting, MGM Resorts is as good a bet as any. 

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

MGM Resorts International Stock Quote
MGM Resorts International
$32.09 (3.15%) $0.98
Penn National Gaming, Inc. Stock Quote
Penn National Gaming, Inc.
$29.61 (3.93%) $1.12
Boyd Gaming Corporation Stock Quote
Boyd Gaming Corporation
$55.55 (5.83%) $3.06
Caesars Entertainment Corporation Stock Quote
Caesars Entertainment Corporation

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 05/26/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.