Golden Nugget Online Gaming Will Its Future Be Golden? By Damien Connelly

GOLDEN NUGGET ONLINE GAMING:

Will Its Future Be Golden? By Damien Connelly

pecial Purpose Acquisition

SCompanies (SPACs) are in fashion. In a 2020 investor presentation, Golden Nugget Online Gaming (Nasdaq: GNOG) estimated its pro-forma enterprise value to be $745 million. As at close of trade 17 February, GNOG’s EV was estimated to be $1.18 billion by Morningstar.

In a 2021 prospectus, GNOG described itself as “an online gaming, or iGaming, and digital sports entertainment company focused on providing our customers with the most enjoyable, realistic and exciting online gaming experience in the market … we aspire to live up to the reputation of Golden Nugget, a storied brand in the gaming industry, by providing customers with an online gaming experience consistent with Golden Nugget’s land-based casinos. Our technology is designed to create superior online betting experiences for the avid casino and sports bettor. Our goals have been shaped with these players in mind, both in who he or she is today and who the company anticipates he or she will become as the gaming industry evolves.”

In my Last Word in issue 142 of Casino Life titled ‘Pivot Your Operations’, I touched on the opportunities being alluded to in this article’s main image — from a corporate strategy perspective, it’s what Coca Cola called ‘within arm’s reach.’ You can see from the Player Economics slide from GNOG’s 2020

investor presentation the value differentials between iGaming, land-based casino, and online sports customers.

With an objective of winning ~10% of the U.S. iGaming market, as Tilman J. Fertitta, Chairman and CEO of GNOG stated upon the release of its preliminary, estimated, and unaudited financial results, “2020 was a transformational year for GNOG, which went public, reached $100 million in GGR, and signed market access agreements in multiple states. We look forward to replicating our New Jersey success in many other states and taking advantage of the strong growth of online gaming in the U.S.”

I am not an investment professional, so please don’t treat this article as in any way providing investment guidance. It’s just an opinion piece written by someone with an opinion and with industry knowledge. With database overlaps between GNOG and Landry’s, its focus on higher lifetime value (LTV) iGaming customers, the fact I consider there to be other accretive opportunities waiting ‘on the touchline’, and its obvious success in making customers ‘stick’, the future looks golden for GNOG.