The results are in, and the winner of Super Bowl XL is the city of Las Vegas. Oh, sure, the Pittsburgh Steelers relived their glory years of the 1970s and captured their fifth world championship ring -- the elusive "one for the thumb." But they didn't rake in nearly $100 million from the game, which is the amount that spectators wagered in Nevada's 176 licensed sports books.
Not that Las Vegas needs an excuse to throw a party, but the atmosphere on the Strip always ramps up a few notches ahead of the Super Bowl. In fact, next to the host city itself, Las Vegas has become the ultimate destination for watching the big game. The venues have changed somewhat over the last couple years, thanks to some heavy-handed tactics used by the NFL. The league -- which has gone to great lengths to disassociate itself from an industry that has benefited it greatly -- has threatened to charge anyone who collects admission and/or shows the game on anything larger than a 55-inch screen with copyright and broadcast violations.
The complaint has effectively ended the elaborate ballroom parties, where ticketholders enjoyed unlimited food and beer and watched the game in comfort in front of a giant screen. It has not, however, slowed the flood of football fans that descends on the city each year for Super Bowl weekend. According to the Las Vegas Convention and Visitors Authority (LVCVA), an estimated 285,000 people came to town for this year's contest. Only now, most of them have to elbow through the crowd for a good spot in a bar, lounge, or sportsbook.
With record numbers of visitors circulating throughout casinos on Super Bowl Sunday, the day has become one of the most profitable of the year for top-tier operators like Harrah's (NYSE:HET), MGM Mirage (NYSE:MGM), and Las Vegas Sands (NYSE:LVS). This year's spectators collectively wagered $94.5 million on the game, a sharp 40% increase from the amount bet just five years ago.
|
Year |
Total Wagers |
Win |
Win % |
|---|---|---|---|
|
2006 |
$94.5 million |
$8.8 million |
9.3 |
|
2005 |
$90.8 million |
$15.4 million |
17.0 |
|
2004 |
$81.2 million |
$12.4 million |
15.3 |
|
2003 |
$71.7 million |
$5.3 million |
7.3 |
|
2002 |
$71.5 million |
$2.3 million |
3.3 |
|
2001 |
$67.7 million |
$11.0 million |
16.3 |
While wagers rose to record levels for the fifth straight year, this year's winning percentage was relatively thin. Many in the crowd stood behind the favored Steelers, who easily covered the four-and-a-half-point spread. And so-called "prop" bets -- where gamblers can wager on anything from the first commercial to the number of penalties -- were less profitable than usual. However, most bettors were expecting more offense and misfired on the over/under line (a bet on the total number of points scored in the game), which helped the industry hang on to $8.8 million in wins.
That number is misleading, though, since the overall economic impact of the game is far greater than the money wagered in the sports books -- or elsewhere in the casino. Naturally, most visitors also shelled out a few dollars for hotel rooms, meals, shopping, and entertainment -- approximately $102.4 million of them.
Don't expect the upswing in business to have much of an effect on your portfolio, though. By comparison, industry leader Harrah's alone took in more than $2.3 billion last quarter. Nevertheless, the Super Bowl is a winning proposition for casino owners, regardless of who takes home the trophy.
Hit the instant replay button and enjoy these previous Takes again:
Fool contributor Nathan Slaughter would like to congratulate the Steelers. He owns none of the companies mentioned.
