Here’s why the PointsBet share price is stumbling on Monday

The PointsBet Holdings Ltd (ASX: PBH) share price is faltering on Monday amid news the company will soon lose its title as one of the ASX’s top stocks.

The bookmaker will be dumped from the S&P/ASX 200 Index (ASX: XJO) later this month as part of S&P Dow Jones Indices’ quarterly shakeup.

At the time of writing, the PointsBet share price is $2.18, 6.44% lower than its previous close.

For context, the ASX 200 has lifted 0.09% right now.

So, what does the company’s exclusion mean and what stock will take its place on the index? Let’s take a look.

PointsBet share price slumps as company ousted from ASX 200

Embattled bookmaker PointsBet was dealt yet another blow over the weekend.

News its days on the ASX 200 are numbered was released after the market closed on Friday. The company will be ditched from the index in just under two weeks.

And that’s bad news for the PointsBet share price. It means funds tracking the index will be forced to dump the stock before the market opens on 19 September.

That will likely see supply of the company’s securities increase, thereby reducing demand and, as a result, its share price.

PointsBet is one of eight shares to be removed from the ASX 200 later this month.

Other ASX 200-leavers include tech stocks Zip Co Ltd (ASX: ZIP), Life360 Inc (ASX: 360), and EML Payments Ltd (ASX: EML), as well as retailer City Chic Collective Ltd (ASX: CCX) and asset manager Janus Henderson Group (ASX: JHG).

They will be replaced by Lovisa Holdings Ltd (ASX: LOV), Sayona Mining Ltd (ASX: SYA), and Spark New Zealand Ltd (ASX: SPK), among others.

The bookmaker’s exclusion from the index follows a period of poor performance.

The PointsBet share price has fallen 69% since the start of 2022. It’s also currently trading 80% lower than it was this time last year.

For comparison, the ASX 200 has slumped 10% year to date and 9% over the last 12 months.

The post Here’s why the PointsBet share price is stumbling on Monday appeared first on The Motley Fool Australia.

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More reading

• Why these 3 ASX shares could be in for a massive boost this month
• 5 things to watch on the ASX 200 on Monday
• Zip and these shares have been kicked out of the ASX 200 index
• Why Core Lithium, Mineral Resources, PointsBet, and Strike Energy are dropping
• Broker tips PointsBet share price to double

Motley Fool contributor Brooke Cooper 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 EML Payments, Life360, Inc., Pointsbet Holdings Ltd, and ZIPCOLTD FPO. The Motley Fool Australia has positions in and has recommended EML Payments. The Motley Fool Australia has recommended Lovisa Holdings Ltd and 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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