888 and Bwin.Party surge on New Jersey gambling

Bwin.Party led advancing stocks in the FTSE All- Share Index, while 888 Holdings, Playtech, a gaming software developer, and betting firm Sportech were among the top 10 gainers on the index.

Christie said last Thursday that he would support a 10-year trial for online betting in the state to see whether it helps struggling Atlantic City casinos. He vetoed a bill and sent it back to lawmakers with recommended changes including the time limit, an increase in the tax on Internet bets and more money to help problem gamblers.

“This is a better than expected outcome and paves the way for online poker in New Jersey by September this year,” Simon French, an analyst at Panmure Gordon in London, wrote in a note today. He has a buy recommendation on all four companies.

New Jersey Senator Raymond Lesniak, a Democrat who sponsored the bill, said he expects the changes to be approved by the state Assembly this month and by the Senate in March, paving the way for a signature from the Republican governor and for online bets to be taken in September.

Better News
“We had thought it most likely that the governor would veto the bill,” Ivor Jones, an analyst at Numis who has a buy rating on 888 and Bwin.Party, wrote in a note last week. “This is much better news.” Jones said a start to online gambling in New Jersey could encourage other states to follow suit.

Shares of Caesars Entertainment, the largest operator in Atlantic City with four casinos, rose 19 percent last Thursday in New York. 888 has a joint venture agreement with Caesars. “While it is still early days, we are very excited by the opportunities that the U.S. market looks set to provide,” a spokesman for 888 said today in an e-mailed statement.

Bwin.Party was up 20 %, extending its gain this year to 26 %. 888 Holdings was up 15 %. The stock has more than doubled in 12 months. Betfair rose as much as 5.2 %, its biggest intraday gain in seven months.

Playtech, which said yesterday its fourth-quarter earnings rose as William Hill Online delivered a record contribution to the company, gained as much as 5.8 % in London. Sportech advanced as much as 6.9 %.