DraftKings (NASDAQ:DKNG) could be sitting on a big opportunity about to open up north of our border. On our Thanksgiving Day, Canada's Justice Minister David Lametti introduced a bill in the country's parliament to legalize sports betting. The following day, DraftKings stock rose 5%.
The bill would, by amending the country's current legislation, allow Canadians to place bets on individual sporting events. At present, the country only allows only so-called "parlay" bets on several contests at once. To win, bettors must correctly guess the outcome of all selected games.
Even though this is extremely difficult to do successfully, Canadians still try -- according to the Canadian Broadcasting Corporation, around 500 million Canadian dollars ($384 million) per year are spent on such wagers through licensed gambling channels.
While it is unlikely that the bill specifically allows foreign companies to operate on the Canadian market, there's little reason to believe that an assertive and experienced operator south of the border such as DraftKings would be barred in some way.
So if it were allowed to operate more or less freely, DraftKings -- still considered a growth stock by many -- could readily tap into that potentially big market. That's an enticing possibility and is well-timed, coming as it does among similar liberalization of sports gambling law in numerous U.S. states. The company's experience in entering those American markets should serve it well in our neighbor to the north.