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Why is the PointsBet share price rising on Tuesday?

What did PointsBet tell the market today?

Posted by
Bronwyn Allen
Author bio Bronwyn has 28 years of experience in journalism, copywriting, and media relations. She began her career as a reporter with News Corporation in Sydney in 1997. She later worked for two real estate corporations in communications and PR roles, then started her own freelance copywriting and publicity business. A keen shares investor, Bronwyn joined the Motley Fool Australia team as a copy editor and writer in June 2021. Areas of expertise ASX shares and ETFs News writing Macroeconomic trends Real estate Education Diploma in Journalism, Macleay College Social media LinkedIn Favorite investment quote "Don't look for the needle in the haystack. Just buy the haystack." — John C. Bogle, Vanguard founder and pioneer of index investing for ordinary investors
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Key points
  • The PointsBet share price is 3.6% into the green on Tuesday 
  • The bookmaker has announced it has the go-ahead to commence operations in an eleventh state in the United States 
  • Its launch in Kansas will coincide with the first game of the National Football League season 

The PointsBet Holdings Ltd (ASX: PBH) share price is 3.6% into the green on Tuesday after the online bookmaker released a company update. The PointsBet share price is $3.295 at the time of writing.

Let's take a look at the details.

Sports fans looking at smart phone representing surging pointsbet share price

Image source: Getty Images

PointsBet share price up after Kansas operations approved

PointsBet has announced that it's got the go-ahead to start operations in Kansas in the United States.

The company said the Kansas Racing and Gaming Commission has given it provisional certification to commence sportsbook operations on 1 September.

The approval is still subject to a final launch authorisation.

Sports betting legislation in Kansas was only passed in May. It allows both online and retail betting to start with a soft launch on 1 September. The official launch is on 8 September. This coincides with the first game of the National Football League (NFL) season.

PointsBet is gaining access to the Kansas market via a 'primary skin' agreement with Kansas Crossing Casino. The casino and hotel are located within a four-state border area incorporating Oklahoma, Missouri, and Arkansas.

The Kansas operation will be the eleventh for PointsBet in the US. It's already up and running in New Jersey, Iowa, Indiana, Illinois, Colorado, Michigan, West Virginia, Virginia, New York, and Pennsylvania.

What did management say?

PointsBet Group CEO and managing director Sam Swanell said:

We are excited to be launching on the starting line and having our outstanding sportsbook
product available to the people of Kansas from day one.

With NFL season kicking off on September 9 the timing is perfect to showcase our NFL in-play betting capabilities in particular.

What's next for the PointsBet share price?

It's been a horrible year for PointsBet with its share price down 53% year to date. But there is hope on the horizon, according to broker Bell Potter.

As my Fool colleague, James reported last week, the broker has a $5.25 price target on PointsBet shares. A price target is where a broker thinks the share price will be in 12 months' time.

This implies a potential 60% upside for ASX investors.

The broker is retaining a speculative buy rating on the stock.

Motley Fool contributor Bronwyn Allen has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Pointsbet Holdings Ltd. The Motley Fool Australia has recommended Pointsbet Holdings Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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