Sport fans across Australia are rejoicing as major football codes restart their season, following a hiatus enforced by the coronavirus pandemic. The NRL rebooted its season on Thursday, while AFL is set to start on 11 June.
Here are 2 ASX shares to keep your eyes on as elite and social sport returns.
Pointsbet Holdings Ltd (ASX: PBH)
PointsBet is a corporate bookmaker that has operations in both Australia and the US. The company offers its services through a cloud-based platform that allows clients to wager on a slew of sports and racing products. Despite being sold-off earlier this year, the PointsBet share price has bounced a monster 400% from its March lows.
Earlier this week, PointsBet released a trading update that highlighted how the return of NRL and AFL will boost business operations. Despite the disruption of the coronavirus pandemic on these sporting codes, the company was able to record ‘net wins’ for both February and March. PointsBet calculates ‘net win’ as the dollar amount received from clients who placed losing bets, less the dollar amount paid to clients who placed winning bets, less client promotional costs such as money-back offers and bonus bets.
PointsBet also informed the market that its Australian trading business is continuing a positive trend in the 4th quarter, having achieved a net win of $18.2 million for the period 1 April to 25 May.
In addition to strong Australian operations, PointsBet also elaborated on the company’s agreement to become the exclusive wagering partner for Fox Sports AFL (Fox Footy) for the 2020 season. The agreement will allow PointsBet to target its media assets which will hopefully lead to the acquisition of more clients and increased wagering volumes.
PointsBet also elaborated on its US operations, noting a $0.3 million net win for the period 1 April to 25 May as major sporting leagues closed. Although the PGA has already announced it will return in June, the timeline for other major sports remains uncertain.
Super Retail Group Ltd (ASX: SUL)
Another auxiliary service that could benefit from the return to sport could be Super Retail Group. The group owns prominent retail outlets such as Supercheap Auto, BCF and Rebel. Despite being one of the most shorted stocks on the ASX, the Super Retail share price has bounced more than 139% from its March lows.
As elite and community sport returns, the company’s sporting outlets like Rebel could see renewed demand. In an earlier trading update, Super Retail informed the market that the company has maintained positive sales momentum during the pandemic thanks to a strong online presence. The group’s Rebel sports stores also saw a surge in demand as the shutdown of gyms drove consumers to stock up on home fitness gear.
Foolish takeaway
The restarting of sports in Australia after a prolonged period of social distancing and isolation could reignite demand across all services. In my opinion, sports and related services will be an interesting sector to watch for growth in 2020 and beyond.
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More reading
- Why ALS, Metcash, NAB, & Pointsbet shares are racing higher
- Why the PointsBet share price is on a winning streak this morning
- These are the 10 most shorted ASX shares
- 5 dark horse ASX shares that have tripled in the last 2 months
- Is the Pointsbet share price poised for future growth?
Nikhil Gangaram has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Pointsbet Holdings Ltd. The Motley Fool Australia owns shares of and has recommended Super Retail Group Limited. The Motley Fool Australia has recommended Pointsbet Holdings Ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. 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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