Changes are happening - please bear with us while we update our site.

Changes are happening - please bear with us while we update our site. Click here to give us your advice and feedback.

Pointsbet (ASX:PBH) launches 8th US state – is now the time to buy shares?

The Pointsbet Holdings Ltd (ASX: PBH) share price raised 3% yesterday after announcing it had launched operations in Virginia.

Pointsbet Holdings Ltd (ASX: PBH) announced yesterday it has launched operations in its eighth US state, Virginia.

Shares finished 3.51% higher for the day, however, have lost 38.41% of their value since the start of 2021.

Is now the time to consider Pointsbet shares?

PBH share price

Source: Rask Media PBH 1-year share price
Source: Rask Media PBH 1-year share price

Pointsbet launches 8th state

In November, the Virginia Lottery issued Pointsbet, together with racetrack Colonial Downs, an official license to offer online sports wagering within the state.

This is in addition to existing licenses held by Pointsbet in New Jersey, Iowa, Indiana, Illinois, Colorado, Michigan, and West Virginia.

“Virginian sports bettors will now have access to PointsBet’s fast online sports betting product with the most betting options, including robust in-play capabilities.” – Johnny Aitken, PointsBet USA CEO

The business has utilised its partnership with NBC Sports to promote the Pointsbet brand across its network.

Pointsbet has already appeared on local programming for the Washington Football Team, Wizards and Capitals.

However, residents have been unable to place bets while it awaited Pointsbet’s operational launch.

“Viewers who have become familiar with the PointsBet brand through our odds integrations and expert analysis during television broadcasts can now truly experience what sets PointsBet apart.” – Kyle Christensen, PointsBet USA CMO

Show me the money

Despite the business growing betting turnover of 42% over the past year, the market has punished Pointsbet for its cash flow (or lack of).

Source: PBH Q1 FY22 Investor Presentation opens new window
Source: PBH Q1 FY22 Investor Presentation

In the last quarter, the business spent more on marketing than it retained in gross profit.

Put simply, Pointsbet in its current form is unsustainable.

Subsequently, the market has turned sour on the company, betting its plan to roll out across the US will prove fruitless.

Is now the time to buy Pointsbet shares?

The Pointsbet share price has fallen nearly 60% since its high in February.

Clearly, the market has been spooked by the lack of profitability. It should also be noted Pointsbet is taking on some large competitors including Flutter and DraftKings.

Personally, I think the business could succeed if it’s able to capitalize on the NBC partnership.

But at the moment I don’t see any catalyst to rerate the share price. It will likely be burning cash for the foreseeable future, and unless it can rapidly grow, the market will lose interest – if it hasn’t already.

If you’re looking for new ASX share ideas, check out three I’d be willing to buy on any market pullback.

$50,000 per year in passive income from shares? Yes, please!

With interest rates UP, now could be one of the best times to start earning passive income from a portfolio. Imagine earning 4%, 5% — or more — in dividend passive income from the best shares, LICs, or ETFs… it’s like magic.

So how do the best investors do it?

Chief Investment Officer Owen Rask has just released his brand new passive income report. Owen has outlined 10 of his favourite ETFs and shares to watch, his rules for passive income investing, why he would buy ETFs before LICs and more.

You can INSTANTLY access Owen’s report for FREE by CLICKING HERE NOW and creating a 100% FREE Rask Account.

(Psst. By creating a free Rask account, you’ll also get access to 15+ online courses, 1,000+ podcasts, invites to events, a weekly value investing newsletter and more!)

Unsubscribe anytime. Read our TermsFinancial Services GuidePrivacy Policy. We’ll never sell your email address. Our company is Australian owned.

Information warning: The information on this website is published by The Rask Group Pty Ltd (ABN: 36 622 810 995) is limited to factual information or (at most) general financial advice only. That means, the information and advice does not take into account your objectives, financial situation or needs. It is not specific to you, your needs, goals or objectives. Because of that, you should consider if the advice is appropriate to you and your needs, before acting on the information. If you don’t know what your needs are, you should consult a trusted and licensed financial adviser who can provide you with personal financial product advice. In addition, you should obtain and read the product disclosure statement (PDS) before making a decision to acquire a financial product. Please read our Terms and Conditions and Financial Services Guide before using this website. The Rask Group Pty Ltd is a Corporate Authorised Representative (#1280930) of AFSL #383169.

At the time of publishing, Lachlan does not have a financial or commercial interest in any of the companies or funds mentioned.
Skip to content