How to buy DraftKings stock
DraftKings (DKNG) is an online sports platform that allows users to play daily fantasy games and win cash prizes. DKNG stock is a promising long-term prospect in the sports-betting industry, and the company's potential is encouraging. Despite a lack of earnings, the company has strong revenue growth and is one of the leaders in the online betting megatrend. With the advent of online gambling moving across America state by state, should DraftKings stock be a buy for growth investors? And how can you invest in DraftKings and is it a good investment?
How do I buy shares in DraftKings?
In order to purchase DraftKings stocks through a brokerage, the brokerage must have access to the NASDAQ. Popular online brokerages with access to the U.S. stock market include big names Charles Schwab, Vanguard Brokerage Services, Fidelity, TD Ameritrade, WeBull, E*TRADE and Robinhood.
Is DraftKings a good long term investment?
DraftKings is at the head of a nascent industry that is looking set to grow significantly. DraftKings stock is a promising long-term prospect in the sports-betting industry, and the company's potential is encouraging. Despite a lack of earnings, the company has strong revenue growth and is one of the leaders in the online betting megatrend. If DraftKings can make progress toward achieving profitability, its share price could ascend.
Perhaps one of the most attractive aspects of investing in DraftKings is that it’s a pure-play for online betting in the United States. DraftKings is leaner, more scalable, and has one sole focus which investors will find enticing. From 2017 to 2020, DraftKings' revenue grew from $192 million to $615 million and at an accelerating rate — from 17.9% in 2018 to 42.9% in 2019 and 90% in 2020.
The current lack of profitability is undoubtedly a risk to shareholders. However, for more aggressive investors, the accelerating revenue growth in an expanding market, the superior gaming business model, and the bargain price could make the risk worthwhile.
Is DKNG a good stock to buy now?
Based on 21 analysts covering the stock, 11 (52%) rated it a Buy, 9 (43%) rated it a Hold, and one (5%) gave it a Sell. The mean price target is $35, with a high estimate of $60 and a low estimate of $19.
The valuation of DraftKings and the hype surrounding the stock should be a concern for potential investors. The wild swings and unsustainable valuations could lead to a few sleepless nights for investors. A big part of successful investing starts with not making obvious mistakes. The stock fell 41% in 2021 and has kept falling in 2022. Wait for DKNG stock to break out past a new buy point. Since the stock is about 70% off its 52-week high and not at a new buy point, it is not a buy right now.
If you decide to invest in DraftKings, then you must be ready to sit tight as the market could be near-term headwinds. DraftKings' stock price is likely to remain volatile, as investors struggle to weigh its massive growth potential against its mounting near-term losses. However, we believe that the current valuation in DKNG stocks seems more of a Buy than a Sell.
