Analyst Paints Rosey Outlook for Zynga
Joseph Stauff of Susquehanna Financial Group believes the “sky is the limit for Zynga” in the wake of a third state this week legalizing “real money” online gambling.
That state is New Jersey. Governor Chris Christie signed a measure legalizing Web gambling for those logging on within the state. Because New Jersey is within an easy reach of two major metropolitan centers, the industry could potentially tap into a market that nearly doubles the Garden State’s population of 9 million.
Nevada, with a population of around 3 million, and Delaware, with a population of just under 1 million, have both legalized some forms of Web gambling in recent months.
Stauff said of Zynga on Wednesday: “likely to attract strategic interest over the next year” as a U.S. online gambling asset. He points to the fact that the company already has about 15 million U.S.-based online poker players, many of whom could be converted into paying gamblers if the opportunity arises.
“We view significant value in its U.S.-based stable of players where scale is necessary,” Stauff added. “And only Caesar’s and Zynga have ‘current’ databases of online players.”
Stauff also noted that most casinos claim a “rake,” or percentage, of all the money put into poker pots of between 5 percent and 10 percent, something that would benefit Zynga substantially.
- Aaron Goldstein, Gambling911.com
