U.S. states to look to online gaming to fill budget gaps
Morgan Stanley raises the possibility that as U.S. states cope with challenged finances due to the coronavirus, they could look to online gaming to fill budget gaps.
" You might recall our podcast a few weeks back when we talked about the hole in state budgets. It's going to be as high as $375 Billion in our view. And even if states use their rainy day funds and freeze spending at current levels, they're still over two hundred billion dollars short. Now, of course, Congress could just come in and appropriate that money to the states and there's increased discussion in D.C. about the possibility. But let's assume for a moment this doesn't happen. This is where online gambling comes in. My colleague Thomas Allen, who covers this sector for our equity research department, has been quick to note that some states have been reticent to approve and tax online gambling. But in light of this deficit, they could reconsider as they're faced with the tough choices of raising taxes, cutting essential spending, or both. Hence, budget stress could be an opportunity for market growth in online gambling, a key benefit to several stocks in the sector." Great news for those that bought William Hill at the 30p low back in March.