Us gambling
You bought a ROKU set which you are very impressed with and you saw the number of Chewy boxes on local doorsteps increase dramatically during lockdown.
An extremely good base from which to make investment decisions you said, try the product before you buy the stock. So true.
I’m seeing an extraordinary growth in YouTube presenters researching and endorsing DraftKings as a product. Would you mind giving us a bit of a deep dive into Draftkings in particular and the gambling sector as a whole?
I followed you in with GAN by the way
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I regret selling DraftKings after that first post-SPAC merger surge, and they are emerging as the strongest brand — though part of that’s because I’m in Massachusetts, FanDuel is stronger in some markets. The valuation has been at “just hold your nose and buy growth” levels for a long time, partly because sports gambling hasn’t historically been all that profitable (though that may change as the market evolves, the crazy online bets are higher-margin for the casino than “traditional” sports bets). It’s been in the back of my mind for a while, and certainly among the ways to play the unstoppable trend of spreading sports gambling legalization, but it’s mostly a “brand” bet and it’s really hard to know whether this will be a “winner take most” industry like most of technology, or if it will be very competitive. So far it’s pretty competitive, with folks like BetMGM and Caesars getting their act together and smaller tech providers like Kambi, GAN and EVO helping small casinos hold their share, but there is a chance for a national oligopoly to emerge… which would make the valuation of DKNG seem more rational.
Thanks a lot Travis
Hi Travis, would you consider DraftKings at these levels?
Would I consider it? Sure, they have the potential to build the leading brand in a growing space. Opinions are easy to have, though…. Have I bought it? No.
Maybe I will someday. Still very richly valued, as it has always been, still could potentially be in an insanely competitive space for a long period of time as big brands try to stake out their market share.
Many thanks Travis