Gaming stocks had a dismal week, and the Roundhill Sports Betting & iGaming ETF, which invests in a basket of gaming companies, fell 1.36%, which was twice the drawdown in the S&P 500 Index. The gaming season began on a somber note for gaming stocks, and all eyes will be on the flurry of earnings lined up for this week.
The Star Entertainment Group and Churchill Downs were among the major gainers last week, while Playtika Holdings and DraftKings were among the major losers.
Biggest Gainers
The Star Entertainment Group (ASX: SGR) +9.09%
With gains of over 9% last week, Star Entertainment was by far the biggest gainer in our coverage of gaming stocks. The stock held its position in the preceding week and is now up nearly 24% over the last month, helping it narrow its year-to-date (YTD) losses to around 33%.
As a heavily shorted, low-priced stock, SGR is prone to pronounced price swings. Small shifts in volume, short-covering by traders, or general sector rotation across consumer discretionary and gaming stocks can lead to double-digit percentage pops without new announcements.
The recent uptrend seems driven by the company’s turnaround efforts. SGR has been taking several measures to turn around its business and address its stretched balance sheet. Earlier this year, it completed the sale of its 50% stake in the Queen’s Wharf Brisbane project to its partners, Chow Tai Fook and Far East Consortium.
Subsequently, in June, Star finalized a vital $390 million (around AUD 540 million) debt facility with WhiteHawk Capital Partners to avoid a near-term liquidity collapse.
With US-based Bally’s Corporation and the Bruce Mathieson family holding massive combined stakes in the company, the stock is seen as a highly speculative turnaround play backed by deep-pocket gaming heavyweights.
Churchill Downs (NYSE: CHDN) +3.05%
Churchill Downs rose over 3% last week but is still down nearly 24% for the year. Last week’s gains could be attributed to Friday’s rally, as the stock likely advanced in anticipation of a strong earnings report next week.
Notably, while CHDN has had a dismal run this year, Wall Street analysts are upbeat on the stock, and its mean target price of $138.50 implies more than 60% upside over the next year.
Better Collective (STO: BETCO) +3.02%
Better Collective shares gained over 3% last week, extending their YTD gains to over 7%. Earlier this month, BETCO announced it is launching in Alberta, Canada, following the launch of regulated iGaming and sports betting in the region.
There wasn’t any major company-specific announcement last week, barring the release of weekly share repurchase data, which showed that it repurchased nearly 11,000 shares each day of the week as part of its 40 million euro share buyback plan.
Biggest Losers
Playtika Holdings (NYSE: PLTK) -8.34%
With a loss of over 8%, Playtika was the worst-performing gaming stock in our coverage last week. The stock was quite volatile last week amid rumors that it is in talks with Chinese tech giant Tencent to sell Israeli gaming studio SuperPlay for up to $1.5 billion. The reported purchase price is over twice what Playtika paid to acquire the company in 2024.
Notably, Playtika hit a low of $2.64 in early April amid concerns over the sustainability of its business and its stretched balance sheet. Later that month, it announced a “review of strategic alternatives to maximize shareholder value.”
The company has formed a special committee of independent directors that is tasked with “conducting a comprehensive review and evaluation of strategic alternatives across its portfolio.”
While reports of its selling SuperPlay haven’t been confirmed or denied, they should be viewed in light of the strategic alternatives it is pursuing.
DraftKings (NYSE: DKNG) -7.74%
DraftKings continued its volatile run, falling nearly 8% last week and extending its YTD decline to over 33%. The sentiment was dampened by several factors, including the broader market sell-off and reports that prediction markets took a large share of revenue from legacy sportsbooks during the recently concluded FIFA World Cup. Gambling Capital estimates that the share of prediction markets in overall legal sports betting volumes in the U.S. swelled to 27% during the World Cup, up from 4% at the beginning of the year.
Analyst sentiment towards DKNG was quite subdued last week, and Bank of America lowered its Q2 adjusted EBITDA estimate to $120 million, well below the $173 million the Street is expecting. Stifel also lowered its estimates as it factored in World Cup marketing investments and the adverse impact of the hold into its forecast. The brokerage also lowered DKNG’s target price from $40 to $38. Truist and Wells Fargo also lowered their target prices ahead of the company’s Q2 earnings report, scheduled for August 6.
Betr Entertainment (ASX: BBT) -5.71%
Betr Entertainment made it to the list of top losers for the second consecutive week. The stock tumbled over 8% on Friday and ended the week negative amid weakness in speculative shares on Australian markets.
Notably, Betr Entertainment is a micro-cap stock with a market capitalization below AUD 200 million, which makes it prone to wild price swings. The company is set to report its Q2 earnings next week, and some investors may have exited their positions ahead of the report.
Major Gaming Market Developments Last Week
Last week, the US Congress held its first dedicated hearing reviewing sports event contracts and the rapid expansion of prediction platforms. While a full federal ban is currently unlikely, lawmakers are signaling increased oversight over CFTC-regulated event platforms.
There is also a turf war between states and the CFTC over the regulation of prediction markets. The CFTC is aggressively doubling down on the view that sports “event contracts” fall strictly under its federal jurisdiction, drawing sharp anger from state regulators and tribal governments who argue this is illegal gambling that bypasses state laws.
Several states have banned prediction markets, and Washington could be the next to do so following an adverse court ruling. On a similar note, Wisconsin’s Election Commission said that residents could lose their right to vote if they wager on elections.
Meanwhile, amid the regulatory uncertainty, allegations of insider trading and scams continue to rock prediction markets. In the recent case, George Cottrell’s $9 million Polymarket wager on Donald Trump winning the 2024 U.S. elections is under scrutiny over allegations that he acted as the frontman for Tony Bloom’s betting syndicates.
Looking at the global picture, Brazil’s betting regulator, SPA, opened a 45-day public consultation on upcoming licensing requirements for betting operators, continuing its push to clean up the newly regulated market ahead of full implementation.
In Kenya, the country’s High Court temporarily halted the newly introduced gambling licensing fee hikes following widespread operator pushback.
Last week, the UK Gambling Commission (UKGC) officially confirmed that money from regulatory settlements will now be paid directly into HM Treasury’s Consolidated Fund, the UK government’s central account for tax revenues and public funds. The decision follows an eight-week public consultation launched in February.
Gaming Earnings Last Week
Las Vegas Sands missed on both the top line and bottom line in Q2, and the shares plunged following the conference call. LVS, however, recouped the losses and ended the week in the green.
“In Macao, our ongoing investments in enhanced service and hospitality offerings contributed to growth in volumes across all gaming segments as compared to the prior year, although unusually low hold in rolling play negatively impacted our reported financial results for the quarter,” said the company in its prepared remarks.
After the earnings report, several brokerages, including Barclays, Deutsche, JPMorgan, Goldman Sachs, Mizuho, and Morgan Stanley lowered the stock’s target price.
Boyd Gaming’s Q2 revenues and profits were largely in line with estimates. Analyst action following the report was subdued at best, and there were only cursory target price hikes by Mizuho, Stifel, and Susquehanna.
Monarch Casinos reported revenues of $142.6 million in Q2 2026, 4.2% higher than the corresponding quarter last year, and ahead of Street estimates. Its EPS also easily beat estimates. However, despite the record Q2 performance, the shares traded lower after the earnings release and closed the week almost 3% lower.
While we usually expect stocks to rise following an earnings beat, in Monarch’s case, much of the optimism was already priced in amid the YTD outperformance. The stock was trading near all-time highs heading into the call, and expectations were exceptionally high. Meeting or slightly beating consensus wasn’t enough to sustain that momentum, prompting investors to take profits once the results landed.
Key Gaming Earnings to Watch This Week
We are now in the busiest week of this earnings season, and almost a third of S&P 500 companies, including four “Magnificent 7” stocks, namely Amazon, Apple, Meta Platforms, and Microsoft, are set to report their earnings. The earnings reports of these multi-trillion-dollar behemoths often set the pace for the market, given their sheer size.
This week’s earnings calendar for gaming companies is also quite full. Caesars Entertainment, Robinhood, Churchill Downs, MGM Resorts, Rush Street Interactive, Codere Online, Melco Resorts & Entertainment, and Gaming & Leisure are among the companies scheduled to report their quarterly results this week.
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