The PointsBet Holdings Ltd (ASX: PBH) share price just hit the proverbial jackpot. At close of trade today, the online bookmaker's shares were trading for $13.93 – up 7.32%. The upwards movement came as the company announced it was strategically placed to deal with upcoming regulatory hurdles.
For comparison, the S&P/ASX 200 Index (ASX: XJO) finished the day up 0.84%.
Let's take a closer look at today's news and how it might have affected the PointsBet share price.
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Illinois reverts back to in-person betting
The PointsBet share price flew today. In a statement to the ASX, PointsBet confirmed the US state of Illinois would no longer suspend rules on in-person registration for online betting. The regulation, which was signed into law in June 2019, was suspended by Illinois Governor JB Pritzker one year later due to the COVID-19 pandemic and social distancing concerns.
Illinois is the fifth largest state in the US by population and GDP.
The Governor refused to extend the executive order at its most recent expiry date. As a result, from 4 April 2021, in-person registration will again be mandatory for Illinois residents wishing to make online bets. People will need to register at a licensed gaming location.
In its statement, PointsBet claims it has "a significant competitive advantage in an in-person registration environment." The company believes its sportsbook locations are strategically situated in the Chicago metro area. The statement highlights the Hawthorne Race Course, which is only 8.5 miles from downtown Chicago. The company also states it has 3 other betting locations in the windy city, of which 2 are currently operational. Investors seemingly agree and are pushing up the PointsBet share price as a result.
The company believes it is well situated to transition due to the changing regulation in the state. In addition, PointsBet says it is onboarding and training retail staff in the area ahead of the two biggest events for gambling in the state – the start of Major League Baseball and the Kentucky Derby horse race.
PointsBet share price snapshot
Over the last 12 months, the PointsBet share price has increased a staggering 506.42%. It has, however, come down from its all-time peak of $18.13 it achieved in early February. Concerns over the changing regulatory environment in the US, which PointsBet is aggressively expanding into, has led to a fall in its share price since then.
PointsBet has a market capitalisation of $2.6 billion.
