How sportsbook will develop in the United States is one of the most interesting questions in the gambling industry today. When the Profession and Amateur Sports Protection Act was overturned by the Supreme Court, all eyes turned to the big players in the United States and United Kingdom, speculating about partnerships and expansion. GVC got the ball rolling with its partnership with MGM, and more are sure to follow.

But there are other players here besides the big recognized names that, until now, have never really been considered gaming stocks. The news earlier this month that Buffalo Wild Wings, the most popular US sports bar chain, wants to incorporate sportsbook into its restaurants, in retrospect should not have been surprising. It’s a perfect fit. The restaurant chain has made it clear that it’s looking for a partner, so together with the GVC-MGM partnership, which points to a primarily partnership-based model for this industry going forward. If MGM didn’t go it alone, then other companies probably won’t either. MGM already has sportsbook knowledge, infrastructure, experience, and economies of scale from Las Vegas, and despite all these advantages still sought out GVC.

Buffalo Wild Wings went private last year for $2.4 billion, so nothing doing there for public investors, but this opens up other US stocks to the gaming investment community that will inevitably follow Buffalo Wild so as not to fall behind. One of the more interesting and obscure options is Ark Restaurants (ARKR). Ark already is a casino runoff stock, as its business model is heavily reliant on setting up restaurants in casinos. Sportsbook doesn’t look like it will have a material impact on Ark for a while, but news of Buffalo Wild moving in to the industry will bring Ark more investor attention and could open it up as a portfolio position for many who never seriously considered it before. 8 of its 20 restaurants are in casinos, with 5 more in New York City, where sportsbook legislation failed in 2018, but could be reintroduced in 2019.

The nice thing about Ark as part of a gaming investment portfolio is that it is a stable income-play microcap, which gives it low risk for a microcap but high return potential as a microcap. Aside from an explosion higher from in 2004-2005 and then a crash back down post 2008, it has been a stable microcap since its founding in 1983. It offers a very respectable 4.5% dividend at 25 cents a share that it has paid consistently since the end of the financial crisis, and it has proven profitable even in times of extreme economic stress. From 2008 to 2009, revenue fell 8% and earnings fell 56%, but the key is that it remained profitable even in the depths of the financial crisis when restaurants typically become one of the first victims, and this one a tiny restaurant chain at that.