MGT Capital Investments Inc. (MGT), Comcast Corporation (CMCSA), Yahoo! Inc. (YHOO): 3 Ways to Play Fantasy Sports in 2013

Page 1 of 2

I admit it: I’m not a big sports fan (aside from the ‘big game day’ events with friends). That being said, I and every guy in my office was drawn into the addictiveness that is fantasy sports.

A fantasy sport allows one to build his or her own virtual sports team and “own” real-life athletes to play for his/her team. The fantasy team’s performance is decided based on the performances of these real-life athletes when they compete in real-life sporting matches. The enjoyment made me more of a sports fan, and the money potential became more than just a perk.

Fantasy sports is a fast-growing business.

According
to the Fantasy Sports Trade Association, an estimated 35 million users wager money on fantasy sports. What is even more exciting is that the new trend in fantasy sports is making paydays more than just once a season. Now with daily fantasy sports, a user can draft a team, place a wager, and get paid, all in one day. Sports include the NFL, NBA, NHL, MLB, golf, and NCAA basketball and football.

Atlas Ventures predicts that daily fantasy sports will overtake traditional fantasy sports in 5 to 7 years, and that daily fantasy wagering will generate $2 billion in fees by the year 2020, versus less than $100 million today. There are many smaller competitors in the daily space, including Draftday.com, DraftSreet.com, StarStreet.com, and FantasyThrowdown.com, which offer weekly contests.

Comcast Corporation (NASDAQ:CMCSA)

This industry is growing at triple digit rates. Investors should consider not just playing for the fun, but investing in businesses engaged in the monetization of fantasy sports. To that end, in this article, I will look at MGT Capital Investments Inc. (NYSEMKT:MGT), Comcast Corporation (NASDAQ:CMCSA) and Yahoo! Inc. (NASDAQ:YHOO).

Meet the players

MGT Capital Investments and its subsidiaries are engaged in the business of acquiring, developing and monetizing assets in the online and mobile gaming space. Recently, MGT acquired a 65% stake in FanTD, owner of the daily fantasy sports website www.FanThrowdown.com, for $2,584,500 worth of restricted stock and cash. Although the stock portion will fluctuate with the price of MGT, the deal valued FanTD at roughly $4 million.

MGT Capital Investments Inc. (NYSEMKT:MGT) has a market cap of about 26 million and an EPS (ttm) of -2.79. The negative EPS is largely due to its acquisition and selling off of its other assets. At the current price of about $4.34, the performance of its new site (as well as the settling of current legal woes), could rally the stock back to over $6 a share–a decent gain for investors.

Another major player, and the largest website dedicated to fantasy sports, is FanDuel.com. FanDuel has captured an estimated 60% of the daily fantasy sports market, and as of 2013 its user base exceeded 4 million. This number prompted a sizable $11 million investment led by Comcast Ventures, the venture capital arm of Comcast Corporation (NASDAQ:CMCSA). The $11 million Series C financing for FanDuel was closed with Comcast along with existing investors Piton Capital, Pentech Ventures, Bullpen Capital and serial investor Richard Koch.

Page 1 of 2
blog comments powered by Disqus
Insider Monkey Headlines
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months Click to see monthly returns in table format!

Lists

10 Most Influential Papers In Economics

Top 8 Biggest Charities in the US

10 Worst Celebrity Career Moves Ever

Top 10 Best Paid Tennis Stars in the World

10 Cities with High Demand for Nurses

6 of the Worst Greeting Card Messages Ever Crafted

6 Ways to Make Money in ArcheAge and Build Your Empire

10 Foods To Eat To Lower Cholesterol Levels

The 10 Most Hated Television Characters of All Time

The 30 Worst Halloween Costume Ideas Ever Brought to Horrible Life

10 Vocational Skills in Demand Today with Jobs Waiting to be Filled

10 Best Places to Visit in Central and South America

The 10 Greatest Empires in History Which Nearly Conquered the World

The 6 Cheapest Boarding Schools In America 2015

5 Clear Reasons LoL is Better than DotA, Continues to Rule MOBAs

The Only 9 Teams with a Chance to Win the Super Bowl

The 15 Most Common Phobias in America that Induce Fits of Panic

Top 6 Least Expensive Tourist Destinations in 2014

Jim Goetz, Peter Fenton, Jim Breyer: Top 6 Venture Investors for 2014

Top 15 Billionaires in 2014

5 Pitfalls To Avoid When Buying a Franchise

Top 20 Medical Schools in the US – 2014 Rankings

4 Business Strategies that Turned Jamie Oliver into the World’s Richest Chef

6 Qualities That Make You A Good Team Player

10 High Paying Seasonal Jobs in America this Holiday Season

The 10 Busiest Shipping Lanes in the World

5 Most Valuable Brands in China

The 10 States with Highest Substance Abuse Rates Crippling Their Populace

The Top 10 Things to Do Before You Die That Will Echo for Eternity

The 10 Best Selling Items on Etsy

Top 10 Things to Do in Tokyo, the Greatest City in the World

10 Mistakes on Social Media that Can Harm You and Will Probably Get You Canned

The 10 Best Cities to Find Jobs in 2014

The 10 Most Controversial Songs Of All Time to Hit (and get Banned from) the Airwaves

The 20 Biggest IPOs in US History

The 10 Best Places to Visit in Mexico that Are Beautiful and Safe

7 Bad Habits that Age You Beyond Your Years

The 40 Best Fortune Cookie Sayings That Will Leave You Bemused, Befuddled, or Beguiled

10 Foods to Eat Before a Workout to Make Every Drop of Sweat Count

The 5 Best Documentaries On Netflix You Must See

The Most Heartwarming and Inspirational Story Of This Halloween Season, It Will Make You Cry and Jump For Joy

10 Best Party Songs of All Time to Bring the House Down With

5 New World Order Conspiracy Theories that Will Strangle the World

The 10 Highest Rated Movies of 2014

The 10 Largest Container Shipping Companies in the World

The 10 Largest Armies in the World: Who Should We Be Afraid Of?

Best Warren Buffett Quotes on Money You Need to Hear

The 10 Highest Suicide Rates by Profession

The 20 Most Underrated Movies of All Time

The 10 Fastest Growing Companies in America

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!