As football season kicked off on Thursday, fueling the biggest sports gambling season in the nation, the state of Wyoming owns a stake in how successful at least one major gambling company fares.
The state of Wyoming owns about $110,833.90 worth of shares (2,326 shares total) in sports gambling company DraftKings as of Wednesday, the state treasurer’s office confirmed.
Wyoming has been investing in the company for more than two years.
The state had an even larger position or point-in-time holding as of March 31 of 12,365 shares, or about $419,000 worth, according to form 13F, a quarterly report investment managers have to file with the U.S. Securities and Exchange Commission, which detailed Wyoming’s holdings history.
Launching
DraftKings on Sept. 1, 2021, announced it was launching online sports wagering in Wyoming, after the state legislature approved sports betting and Gov. Mark Gordon signed the legalizing bill April 5, 2021.
Wyoming was the 13th state to authorize the DraftKings Online Sportsbook, the statement says.
While the numbers may elicit a response from people who don’t trade or aren’t familiar with huge publicly traded companies like DraftKings, Wyoming’s investments aren’t large enough to factor for or against its ongoing policy tweaks to gaming legislation, according to state Sen. Tara Nethercott, who chairs the legislative Select Committee on Capital Finance and Investments.
DraftKings has a market cap of $23.53 billion, according to stockanalysis.com.
That makes even Wyoming’s highest investment phases negligible to the company’s fate, Nethercott said.
“Their market is much, much larger than the state of Wyoming,” she said. “And I think if we were to look at their global revenues – any tax shift by percentage points in the state of Wyoming will have absolutely zero impact on shareholder profits to large investors.”
That was a reference to lawmakers’ current efforts to revise the tax rates in the sports betting and other gaming industries operating throughout Wyoming.
Nethercott said it’s good strategy to start conversations around tax changes, to reevaluate whether the people of Wyoming are gaining a reasonable benefit in light of the enormous revenues gaming companies make from residents; and any societal effects the industry has.
She reiterated that even if Wyoming hikes or changes the taxes DraftKings has to pay, “It’s like Coca-Cola. What is Wyoming’s contribution to Coca-Cola’s bottom line? If all of Wyoming stopped drinking Coca-Cola – not sure it would matter much.”
Revenue Chair
State legislative House Revenue Chair Rep. Tony Locke, R-Casper, said he’s interested by the concept of Wyoming investing in a gambling company, and wants to dig into it.
He hasn’t learned enough about the quality or consideration of Wyoming’s investment in DraftKings to pass judgment, however.
Sen. Cale Case, R-Lander, a former Revenue Committee chair and current member, told Cowboy State Daily on Thursday that he doesn’t like the idea of the state investing in gambling – with a caveat:
It’s likely Wyoming’s overall investment portfolio also has numerous and more stable purchases, he said.
Yahoo Finance reported on Tuesday that DraftKings’ shares “are quite volatile and have had 16 moves greater than 5% over the last year.”
Case countered Nethercott’s point, saying it may yet be “bad optics” for Wyoming to be investing in an industry whose authorizations or tax rates it’s currently revising.
“I realize it’s different people doing different things,” said Case, referring to a governmental separation: the state Treasurer’s office making investments, and the legislators making laws.
Still, he added, “I’m not sure we should be investing in gambling when we’re trying as a state to regulate gambling and you know, decide our positions there.”
This Is Not AI
Jeff Robertson, Communications Director for the Wyoming Treasurer’s Office, told Cowboy State Daily in a Wednesday email that there is a position in a U.S. Domestic Small Cap portfolio, where investment decisions “are guided by an internally developed mathematically based computer model that invests in all the components of a broad stock index.”
That is not an artificial intelligence device, he said upon further questioning.
“Our investment team includes trained computer programmers who build models with various stocks included in our various portfolios,” he said in a follow-up email. “They run scenarios as a guide on what we should buy and sell as needed.”
Some Holdings History
Wyoming has been investing in Draft Kings since at least Sept. 30, 2022, federal documents say.
The state held about $88,000 worth, or 5,838 shares at that time. Other point-in-time share phases followed:
• 7,460 shares (about $84,000 worth) on Dec. 31, 2022.
• 4,502 ($119,000) on June 30, 2023;
• 6,020 ($177,000) on Sept. 30, 2023;
• 4,681 ($165,000) on Dec. 31, 2023
• 4,511 ($204,000) on March 31, 2024
• 5,307 ($202,000) on June 30, 2024
• 12,635 ($419,000) on March 31, 2025
• 1,981 ($84,000) on June 30, 2025.
Clair McFarland can be reached at clair@cowboystatedaily.com.
