The 888 share price is hovering near its all-time high as demand for online betting and gambling services soar. The ongoing consolidation in the industry has soared. The shares are trading at 400p, which is 486% above its lowest level in 2020.
Demand for betting and gambling rose
The online betting and gambling sector is seeing impressive growth. A recent report estimated that the online gambling industry will record a 11.5% annual growth rate from 2020 to $127 billion in 2027. Another estimate found that the industry will reach $117 billion by 2025.
This growth was evidenced by the recent strong results by some of the leading players in the world like 888 Holdings, Penn National, and Flutter Entertainment.
In a recent report, 888 Holdings, one of the top-rated casino brands in the world, noted that its business grew substantially in 2020 and in the first quarter of this year. Its casino revenue recorded a 160% year-on-year growth of new customers while poker, bingo, sport, and base had a YoY growth of 100%.
In its first-quarter trading update, the company said that its total revenue rose to $272.5 million in the first quarter of 2021 from $164.6 million in the same period in 2020. This growth was mostly driven by its business-to-consumer business whose revenue rose by 67% from $156.9 million to $262.8 million. It also recorded a 27% growth of average daily first-time depositors in the quarter.
This trend will likely continue this year as the economy recovers. In a statement following the first-quarter update, the firm’s CEO said that the firm’s new 888sport platform was doing relatively well. It is also considering rolling out its services in more states in the United States.
Consolidation in the sector
The 888 share price has also rallied after a series of consolidation and market events recently. Recently, Caesars Entertainment completed the acquisition of William Hill in a deal that was valued a 2.9 billion pound deal. At the same time, Flutter Entertainment acquired another 37% stake in FanDuel Group for $4.2 billion. The company now plans to take FanDuel public.
Meanwhile, Entain Group recently acquired Enlabs, an iGaming company. And early this year, Entain turned down an offer by MGM that valued the company at $13 billion. Entain owns brands like Bwin, Coral, and Ladbrokes, among others. The company has also sought to acquire Tabcorp for AU$3.5 billion.
Therefore, the 888 stock has jumped in part because investors expect that the company will maintain its growth. Also, because of its relatively small size, the company could become an acquisition target.
888 share price forecast
The daily chart shows that the 888 share price has been in a strong upward trend from its lowest level in 2020. The stock has formed an ascending channel. It is slightly above the lower side of this channel. Also, the stock is being supported by the 25-day and 50-day EMAs.
At the same time, it seems to be forming a head and shoulders pattern, which is usually a bearish signal. Still, the shares will likely remain in a bullish trend so long as it is above the two moving averages.
888 Holdings stock chart
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