Gaming Intelligence Stock Index A Mixed Bag

Posted on: April 9, 2014, 05:30h. 

Last updated on: April 8, 2014, 09:59h.

Casino.org Staff Writer Read More

Expertise: Commercial Gaming.

The first quarter of 2014 saw plenty of winners and losers in the gambling industry. That was reflected in the stock market as well, as there were companies that saw incredible gains and disastrous losses along with everything in between. But in the final count, it was more or less a wash.

That’s the news out of the Gaming Intelligence (GI) Stock Index, a barometer of the overall health of the global gaming industry. The GI index tracks 54 publicly listed companies from around the world, including operators, software providers and others who have a role in the gambling industry.

A look at the overall numbers would make it seem like a rather quiet quarter for the world of gaming. As a group, the companies in the GI index saw their stock prices fall – but only by the miniscule amount of 0.01 percent. In total, 31 companies saw their share prices increase, while 23 lost ground over the quarter.

But that mundane number hides the fact that there were both impressive gains and eye-turning losses amongst the group.

Partouche Leads Winners

The biggest winner of all was Partouche. The French gaming firm saw its stock rise 74.4 percent over the quarter, closing at €1.43 on March 31. The company’s stock saw a sharp rise right at the end of the quarter, when Partouche was able to reach an agreement with its creditors to restructure their debt payments. They also benefitted from the sale of two casinos in Belgium.

Also doing quite well was SNAI, an Italian operator that saw stocks rise 40.3 percent to €1.95 during the quarter. That came after a 146 increase over the course of 2013.

Some of the biggest names that came out with significant gains over the quarter included Caesars Acquisition Company (17.6 percent), Boyd Gaming (17.4 percent), Net Entertainment (13.2 percent), and Zynga (13.2 percent).

Ladbrokes, Philweb Among Biggest Losers

Philweb – the largest gaming company in the Philippines – was down 42 percent to post the largest loss of any company on the GI index. But many companies with a larger global footprint were also hurt during the quarter.

Bookmakers in the UK were hit hard by the government’s decision to raise taxes on the highly profitable fixed-odds betting terminals from 20 percent to 25 percent, and it showed in the stock prices of the largest companies in that sector. Ladbrokes stocks tumbled 24.5 percent during the first quarter, while William Hill was similarly down 15 percent, with much of these losses coming immediately after the tax announcement.

Several online operators in the UK were also hurt by a new 15 percent Point of Consumption Tax. Share prices were down for 888 Holdings, 32Red and NetPlay TV.

Bad Weather in US Hurts Stocks

Companies with a major footprint in the United States were hurt by the bad weather gripping most of the country for much of the quarter, particularly in January and early February.

That weather reduced revenues for many casinos, which in turn seemed to be a factor in the prices of major gaming operators. For instance, Caesars Entertainment saw their shares fall 11.2 percent to $21.40. Suppliers were also hit hard, with Scientific Games Corporation dropping 32.2 percent to $16.89 and IGT losing 22.3 percent, ending the quarter at $18.10.