DraftKings (NASDAQ: DKNG), Golden Nugget Online Gaming (NASDAQ: GNOG), and Skillz (NYSE: SKLZ) are among the many gaming stocks entering the widely followed Russell 3000 index one.
As widely expected, DraftKings was listed in the Russell 3000 16 months after its listing. The sports betting operator has a market cap of $20.49 billion, making it one of the larger members of the stock index despite being mired in controversy over allegations by short sellers of illegal gambling, money laundering and links to organized crime in the company's SBTech unit .
Gaming gaming stocks join Russell 3000
In addition to DraftKings, the group of gaming stocks joining the Russell Index reinforces the notion that online casinos and sportsbook operators are not only an increasingly prominent part of the broader gaming puzzle, but are also on the rise in the relevant investment vocabulary .
Esports Technologies, Tilman Fertitta's GNOG, Rush Street Interactive and Skillz. Both have been listed in recent months and also joined the Russell 3000. That's a welcome sign for a group of stocks that have all been beaten down recently. For example, Esports Technologies has been on the market for about two months and will need a refresh to regain its previous highs.
GNOG and Rush Street Interactive are also in decline, with an average year-to-date loss of 35%. However, the companies are as bullish on their prospects as Wall Street, with some analysts and industry watchers highlighting that iGaming, rather than sports betting, is the main driver of future margin expansion and profitability for gaming operators. For its part, Skillz, like DraftKings, has drawn the ire of bearish researchers, with shares remaining volatile, up 44% over the past month but down 10% over the past week. DraftKings, GNOG, Rush Street, and Skillz have something in common: All four entered the market after merging with blank-check companies.
It is important for gaming stocks to join
For the aforementioned bookmakers, joining the Russell 3000 represents the company's first entry into a major stock index. In the case of DraftKings, the company could join the Nasdaq 100 later this year and possibly several other Russell benchmarks later this month. While other stock metrics such as the S&P 500 and Russell 1000 have more assets as benchmarks, entering the Russell 3000 puts these gaming stocks in front of a wide range of investors and qualifies them for inclusion in a large number of passive index funds and exchange-traded funds (ETFs) .
The market value of the gaming market has gradually become mainstream, and these three companies have been successfully
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