on-line gambling to stay.

[johnny1212]

U.S. lawmakers have taken aim at on-line gambling again. Any successful moves to end the practice in the United States could be catastrophic for the business, but Desjardins Securities doesn't see it being prohibited.

In fact, Desjardins analyst David Shore feels the price/earnings multiples in the sector have been unduly constrained by worries about what might happen on the U.S. legislative front. "We continue to believe that the U.S. will eventually have to move to a regulated, not prohibited, environment for on-line gaming -- as other major jurisdictions such as the U.K. have done," he said in a report.

He noted that there have been efforts in the United States to prohibit Internet gambling almost since it began. Despite those efforts, on-line gambling continues to grow. The United States is the largest market, accounting for about half of the total revenue.

The most recent attempts to prohibit on-line gambling have been made by Representative Bob Goodlatte and Senator Jon Kyl. A bill introduced by Representative Jim Leach was passed yesterday by the House financial services committee. The Leach bill would prohibit the use of credit cards and cheques to pay for Internet gambling. It now moves to the House judiciary committee where similar bills have run into difficulties in the past, Mr. Shore noted.


"With jurisdictions such as the U.K. enacting legislation that embraces on-line gaming, we believe it is inevitable that the U.S. will eventually follow suit," he said. Investors "must be aware of the headline risk that the ongoing attempts to ban on-line gaming create," he added. "However, the extremely low multiples in the sector have built in far too much of a risk premium considering the growth prospects inherent in the sector," he said.

[Toronto_Mike]

a good sign.

In Europe a lot of sports teams are actually sponsored by online gambling books.

Doubt that would happen in North America anytime soon.