The PointsBet Holdings Ltd (ASX: PBH) share price is pushing higher on Wednesday.
In late morning trade, the sports betting company’s shares are up 3% to $12.05.
Why is the PointsBet share price pushing higher?
The rise in the PointsBet share price appears to have been driven by a leading broker’s positive reaction to its announcement on Tuesday.
In case you missed it, PointsBet has entered into an exclusive agreement with Cliff Castle Casino Hotel to pursue online sports betting market access in the US state of Arizona.
PointsBet USA’s CEO, Johnny Aitken, commented: “PointsBet is thrilled to begin the process toward offering the passionate, sports-loving communities of Arizona a fast and differentiated sports betting product across every customer touchpoint.”
“We look forward to quickly and responsibly introducing sports bettors and fans to the competitive advantages PointsBet possesses in owning our technology end-to-end, such as market-leading ease of use and the deepest slate of betting options available in the world,” he added.
Analysts at Goldman Sachs were pleased with the news and have reiterated their buy rating and $17.20 price target on the company’s shares.
Based on the latest PointsBet share price, this implies potential upside of almost 43% over the next 12 months.
Goldman commented: “We see today’s announcement as another incremental positive for PBH following its recent market access agreement in the state of Maryland and positioning for the Canadian sports betting market. With the addition of Maryland, PBH now has direct market access to 16 states in the US (18 including untethered states), placing it on track for its target of being operational in 18 US states by the end of CY22.”
The broker notes that Arizona is the 14th most populous state in the US, making up ~2% of the US population. Based on this, it considers Arizona a tier 2 state and estimates that it offers a total addressable market of ~US$0.8 billion at maturity.