Readers may recall that earlier this month I said how DraftKings (DKNG) stock may see $45 before $65. If you listened to me you saved a lot of money.
The Boston, Mas., based betting operator has put up quite the impressive performance in the last couple of months. Its fat double-digit jump in the past month has left the Nasdaq’s gains in the dust. But the market sentiment changed and DKNG shares lost a quarter of its value in 2 weeks.
Is DKNG still a good buy?
What’s so special about this betting app? It is based in the middle of the most lucrative niche in the world, gambling. Of course, Draftkings isn’t alone in this lucrative niche and many more are joining as states are slowly but surely opening their doors for sports betting.
Of course by now, DKNG isn’t exactly the slam-dunk stock pick it was at the beginning of April before it buckled itself into a 65-mph rally. But this is a top-tier name that’s worth holding if your investing time horizon is at least a year. And now is the best time to re-enter the stock as it seems that it has bottomed out and ready to bounce back, as you can see in the chart below.
$DKNG has had a ton of traction lately. A nice pull back and test on the 50-day moving averages and previous levels gives hope for signs of a bottom...let’s see what happens next week! pic.twitter.com/gHx9Hasn7K— Mr. Finance (@JerryCapital) October 17, 2020
You’re buying a flagship betting company when you’re buying DraftKings. This is the operator that sets the bar against which competitors are measured.
Even though we are seeing nationwide game postponements, due to COVID-19, I am sure DKNG have enough strength for another rally, this time towards a $80 price tag. But if the overall market suddenly goes crushing you know what to do-wait for another bottom.