We recently published a list of Jim Cramer’s Latest Calls: 10 Stocks to Buy or Sell. In this article, we are going to take a look at where DraftKings Inc. (NASDAQ:DKNG) stands against other stocks to buy and sell highlighted in Jim Cramer’s latest calls.
Jim Cramer in a latest program on CNBC reminded viewers about the Trump playbook in the story market and said that he never believed the President would start a new trade war with China. Cramer explained that Trump’s rhetoric has been “hot” but the reality is “cool” and his much-feared tariffs against Canada and Mexico might also not realize as the new administration said it will “study” the matter.
“The president loves the stock market; he always loves to send signals that all hell is going to break loose, and when it doesn’t, well, guess what? The market flies. This rally is built on the back of tariffs, more specifically small-than-expected tariffs that could grow bigger if countries don’t play ball. It’s built on the backs of new projects like Stargate, a new AI infrastructure initiative.”
Cramer then explained in detail why he believes Biden and his government were against top companies and how it affected the market and economy. Cramer said Trump is better for stock portfolios.
“He knows business people in Silicon Valley; he knows how things work. You may like him, you may hate him, but the bottom line is, if you’re a tech titan, Trump will take your call. In fact, he’ll call you. Biden, I don’t know if he knew who they even were, and he certainly didn’t bother to call them. In the end, I think he preferred to sue them. If you own stocks, which is why you watch me, Trump’s method is a heck of a lot better for your portfolio.”
READ ALSO: 7 Best Stocks to Buy For Long-Term and 8 Cheap Jim Cramer Stocks to Invest In
For this article, we picked 10 stocks Jim Cramer recently talked about during his programs on CNBC. With each stock, we have mentioned the number of hedge fund investors. Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
DraftKings Inc. (NASDAQ:DKNG)
Number of Hedge Fund Investors: 54
Jim Cramer in a latest program on CNBC said now might be the suitable time to pile into DraftKings Inc. (NASDAQ:DKNG). Cramer said DraftKing’s problems have been due to an impact stemming from “bad luck.”
“First, you need to understand what’s been happening with this one stock. It underperformed last year, up 5% for 2024, but really, it was doing great until the stock sold off hard in December. While DraftKings Inc. (NASDAQ:DKNG) posted solid results in November, there was one glaring issue: all you people betting at home, you’re winning too much. As CEO Jason Robin said in the Comal, quote, “We experienced the most customer-friendly stretch of NFL sports outcomes we had seen early in the fourth quarter ever.” Ever seen early in the fourth. Imagine that. It caused the company to take a $250 million revenue hit. Boy, is that bad news for shareholders. And these customer-friendly outcomes in the NFL have kept on coming. Basically, the favorites are winning at a higher rate than they normally do, and because more people bet on the favorites, it’s costing DraftKings Inc. (NASDAQ:DKNG) money. They’ve just had a real bad run of luck here. Can it last?”
Alger Spectra Fund stated the following regarding DraftKings Inc. (NASDAQ:DKNG) in its Q2 2024 investor letter:
“DraftKings Inc. (NASDAQ:DKNG) is a digital sports entertainment and gaming firm designed to ignite the passion of sports enthusiasts through a diverse offering that spans daily fantasy, regulated gaming, and digital media. We believe the company’s expertise in product development and customer acquisition, which established it as the market leader in daily fantasy sports (DFS), positions DraftKings to be a key driver in advancing the U.S. sports betting market’s growth. The company reported strong fiscal first quarter results, with revenues beating analyst estimates due to broad-based momentum in customer engagement and acquisition. However, on May 28th, the Illinois Senate passed a new state budget that includes a tiered progressive tax on sportsbook operators, effective July 1, 2024. This new tax ranges from 20% to 40% on gross revenues, a significant increase from the current 15% tax rate. Despite management’s belief that it can mitigate the tax impact by reducing promotions in Illinois, this development negatively affected the company’s share price.”
Overall, DKNG ranks 6th on our list of stocks to buy and sell highlighted in Jim Cramer’s latest calls. While we acknowledge the potential of DKNG, our conviction lies in the belief that under the radar AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than DKNG but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
