After Score Media and Gaming Inc. shares surged on optimism that Canada will soon liberalize the rules for sports betting, it is looking for approval to list on a U.S. exchange.
At its annual meeting on Wednesday morning, the company will ask holders to approve a share consolidation, which would set the stage for a U.S. listing.
Score Media, based in Toronto, gained seven straight trading days and is up 266 percent at the beginning of the year, the top performer in the Roundhill Sports Betting & iGaming ETF (BETZ), which rose 21 percent over the same period. As of Tuesday’s close, that has pushed its market capitalization to $2.4 billion.
The main factor for Score Media’s shares has been domestic prospects for sports betting legalization, but its U.S. betting app, theScore, has also beaten the expectations of some analysts. In the fiscal first quarter, its sportsbook—theScore Bet—”demolished” the hopes of Canaccord Genuity, said analyst Matthew Lee, who has a buy rating on the stock.
According to Eight Capital analyst Suthan Sukumar, who also has a buy rating on the stock, a U.S. listing will also allow investors to compare Score Media against its U.S. rivals. Sukumar says another “lucrative” catalyst is the company’s plans to launch an online casino product this year.
Last fall, Canadian Justice Minister David Lametti announced legislation to legalize single-event sports betting in Canada, marking a change in direction for the Liberal government of Prime Minister Justin Trudeau. A second reading is scheduled for Feb. 19 of the legislation, Bill C-13.
Shares of online gambling companies such as DraftKings Inc., along with larger institutional players such as Cathie Wood, have attracted attention from retail investors as more regions move to legalize wagering activity. Aside from the 2019 market access pact, Penn National Gaming Inc. holds a small equity stake in Score Media.